Kathmandu, June 29

A study on the Nepal’s garment industry has found that if the industry can tap even 0.05 per cent of the potential $200 billion US market, readymade garment exports are estimated to exceed $1 billion directly, resulting in the direct employment of 100,000 people.

With the introduction of duty-free, quota-free access to some 66 items to the market in the United States, which was the largest market for Nepal’s garment industry in the past, the Ministry of Industry, in collaboration with the UK aid funded Samarth, had commissioned an assessment on country’s garment industry.

A firm based in Bangladesh, which has carried out similar studies in Bangladesh and Ethiopia, was assigned to assess the current situation and competitive scenario of Nepal’s garment industry through discussions with all relevant stakeholders in the garment industry.

A validation workshop was held here today to share the findings with the stakeholders to shape coherent strategies and action plans that the industry actors and government can pursue in the near future to promote the industry.

A comparative study with Bangladesh (an established market) and Ethiopia (an emerging market) showed that Nepal had a much higher minimum wage and transport lead time, and the government policies were much more export-friendly in those countries compared to Nepal, as per a media release.

“However, the findings pointed out that Nepal can compete in the global market by diversifying away from USA and producing small quantities of customised and specialised products with higher profit margins to cover higher costs.”

The complete report will be ready by the end of July, and will be disseminated to all the stakeholders, including the Ministry of Industry, for implementation.