Busi­ness with China

Southasia - - 15 -

The Nepalese Sec­re­tary at the Min­istry of Com­merce and Sup­plies, Lal Mani Joshi re­cently signed a du­tyfree trade deal with Chi­nese am­bassa- dor to Nepal, Yang Houlan. The trade deal will sig­nif­i­cantly boost bi­lat­eral eco­nomic re­la­tions. The agree­ment, which will come into ef­fect in Jan­uary 2013 and will en­ti­tle 7,787 Nepali prod­ucts to en­ter China on zero tar­iff. In ad­di­tion to this, the deal will boost Nepal’s ex­ports and re­duce its trade deficit with China, which cur­rently stands at NPR 51 bil­lion. Fur­ther­more, Sec­re­tary Joshi re­quested China to in­vest in Nepal to help the lat­ter over­come its sup­ply side con­straints and re­vive its in­dus­trial sec­tor.

The two neigh­bors signed a sim­i­lar agree­ment in 2010 where Nepal re­ceived zero-tar­iff fa­cil­i­ties for 4,721 prod­ucts but this move did not pro­vide any sig­nif­i­cant growth po­ten­tial to Nepali busi­nesses. Fur­ther­more, Nepali traders com­plained about has­sles cre­ated by Chi­nese cus­tom of­fi­cials, which dis­cour­aged ex­ports to China

This time, Nepali traders are hope­ful that the deal will im­prove the coun­try’s neg­a­tive bal­ance of pay­ment with China. Ac­cord­ing to data from the Trade and Ex­port Pro­mo­tion Cen­ter, Nepal ex­ported goods worth Rs 985.6 mil­lion to China dur­ing the fis­cal year 2011/12 and im­ported goods worth Rs 52.92 bil­lion dur­ing the same pe­riod.

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