Kathmandu, Sept. 21 -- Nepal's economy grew by nearly 6 percent in fiscal year 2021-22, soon after the Covid-19 pandemic. The main driver was a release of pent-up demand and a sharp increase in imports after the pandemic had kept both activity and consumption in check.

The surge in imports put heavy pressure on foreign-exchange reserves, which fell to a level sufficient to cover only about six months of goods and services imports. The government and Nepal Rastra Bank moved to contain the pressure, using direct and indirect measures to curb imports and restrain domestic demand.

Those measures have since helped push foreign-exchange reserves to a level sufficient to cover 18.8 months of goods and services imports. Continued growth in remi...