Sunday, May 12, 2013

Trade infrastructure development Nepal's top agenda

---------------Upcoming Nepal-China high-level meeting -----------------------

KATHMANDU, May 12: Amid Nepal´s soaring trade deficit with China, the government is putting forward a host of demands with high-level Chinese officials to boost Nepal´s trade with the northern neighbor.

Nepali official team to be led by Foreign Minister Madhav Prasad Ghimire is scheduled to request to the top Chinese delegation next week for Chinese support in Nepal´s trade infrastructure development including establishment of Special Economic Zone (SEZ) near the northern border and upgrading of Bhaktapur-Tatopani section of the Araniko Highway.

Yang Jiechi, councilor of State Council China, who is also the former foreign minister, is visiting Nepal on May 18-19.

Though China has already granted duty-free access to 7,787 products from the Least Developed Countries including Nepal to its market, Nepal´s trade deficit with China has continued to soar for the last few years.

Weak supply capacity on the back of slow agricultural growth and industrial production and poor infrastructures such as ill-equipped customs, poor road access and lack of well-managed dry ports are the principal hurdles in Nepal´s trade with the Asia´s largest economy. Similarly, insufficient number of functional customs points along the northern borders and existing non-tariff barriers such as stringent quarantine rules and non-cooperation by Chinese customs officials with Nepali traders are also among the major roadblocks in Nepal´s trade with China.

“Although Nepal has the potential to benefit immensely from trade with China, we are lacking in modern trading infrastructures. So, we are requesting the Chinese officials for their support in enhancing such facilities. We will also request for minimizing existing non-tariff barriers,” an official privy to the development told Republica on Sunday.

Agenda items

Upgrading Bhaktapur-Tatopani road

Customs simplification
Upgrading custom points
Establishment of cross border economic zone in Jielong and Rasuwagadhi
Establishment of SEZ near northern border
Discussion on Nepal´s ballooning trade deficit with China

The source said Nepali officials are scheduled to request for establishment of an SEZ in any place near the northern border and upgrading of the Bhakatpur-Tatopani section of the Araniko Highway. Similarly, Nepal will also ask for forming a cross-border economic zone between Chinese town of Jielong in Tibet and Rashuwagadhi of Nepal in a bid to give a boost to economic activities in those areas.

Although there are around a dozen customs points along the Nepal-China border, the one at Tatopani is the most used, so Nepali officials are also requesting for upgrading of other customs points with necessary infrastructures and facilities. Chinese officials have already shown interest to develop a dry port at Rasuwagadhi customs, the second largest customs bordering China. Construction of Larcha dry port in Sindhupalchowk has already begun from December 20 last year under Chinese assistance.

The source also said Chinese imposition of stringent quarantine rules for Nepali goods mainly agro produces and meat products will also be discussed. “As Nepali traders have been complaining of hassles at customs points we are also requesting for simplification of customs procedures,” added the source.

Officials from both the countries are also scheduled to discuss other measures to boost bi-lateral trade and also focus on reducing the ballooning trade deficit with China. Data compiled by Trade and Exports Promotion Center shows that Nepal´s trade deficit with China increased to Rs 51.94 billion during 2011/12, up from Rs 44.89 billion recorded a year before. During the first nine months of the current fiscal year, Nepal´s exports to China was recorded at Rs 1.76 billion against imports worth Rs 51.04 billion.
Published on 2013-05-13 00:00:00

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