The wide trade deficit has become the normal phenomenon of the Nepalese economy. Liberalization has been initiated with the expectation that there will be the free flow of goods and services through which reciprocal benefit can reap up through the country's export, import and industrial development. Considering the same line, Nepal became the 154th member nation of WTO in 2004. The Nepal Trade Integration Strategy (NTIS), 2010 has introduced in which 17 product are targeted to strengthen the competitiveness of the Nepalese trade and later it was upgraded by NTIS, 2016 that recognizes potentials for product and value chain development in sectors: i). Agro and forest products (cardamom; ginger; tea; and medicinal and aromatic plants); ii). Craft and manufacturing products (all fabrics, textile, yarn and rope; leather; footwear; chyangra pashmina; and, knotted carpets); and iii). Services (skilled and semi-skilled professionals in various categories; Information Technology and Business Process Outsourcing [IT and BPO]; and tourism [including leisure, business, education, and medical]). Being the member of WTO, Trade policy of Nepal should be reviewed in a periodic manner. Trade and Policy Review Body (TPRB), an institution of WTO, works regularly on it and as a result, we do have Trade Policy 2015 in execution.
Being the part of regional blocs like SAFTA, BIMSTEC and global organization like WTO, UNCTAD, we do have different challenges in the outer world. Inside the country, we are also facing capacity based problems to the private sector, institutional hindrances on the governmental side and also the geo-political hindrances that left country back on trade. Trade does not stand alone elsewhere in the world. It should have a strong foundation to develop, institution to carry on and competitiveness to retain in the international market. Now with the change in governance system and the establishment of stable government indicates to start the new journey of international trade in days to come.
To take steps for promotion of trade, export-led growth, following issues are needed to be addressed appropriately on time.
a. Supply and Value Chain of NTIS selected goods
b. Trade facilitation (Information, transportation, storage, quarantine related)
c. Non-tariff Mechanism in Trade
d. Informal trade
Further discussion on these issues will be made on the later blog.
