Kathmandu, August 11

The Cabinet has approved the revised Trade Policy that is focused on reducing supply side constraints to boost production, high value addition in export of merchandise goods and service export. Compared with the Trade Policy of 2009, the new policy has tried to align the Policy with other related policies that have larger impact on trade.

Another major focus of the Policy is service trade by utilising the preferences extended by the developed countries for Least Developed Countries and through other regional arrangements like SAARC Agreement on Trade in Services (SATIS).

“Service trade is an emerging area in global trade and we can be competitive in service trade because there won’t be hassles of transit, customs, quarantine and others like in goods trade,” said Toya Narayan Gyawali, joint secretary at the Ministry of Commerce and Supplies and head of the technical committee for trade policy review.

The Trade Policy, 2015 has focused on boosting engineering services, hydropower, tourism, education, information technology and business process outsourcing (IT/BPO), health services and labour (skilled and semi-skilled).

Regarding the goods trade, the Trade Policy, 2015 has incorporated 25 products of comparative and competitive advantages — ginger (also dried), black cardamom, carpets, medicinal herbs and aromatic plants, coffee, chyangra pashmina, sugar, tea, shoes/sandals, textiles, noodles, garments, vegetable/vegetable seeds, dairy products, flower, processed leather, iron and steel products, fruits, honey, pulses, cement, gems and ornaments made from gold/silver and handmade paper/products.

“The revised trade policy is also compatible with Nepal Trade Integration Strategy (NTIS),” according to Gyawali. NTIS, 2010 had also focused on products and services that have high export potential. Products and services incorporated in NTIS have larger impact on poverty alleviation in the value chain process from production to export. The new trade policy has also prioritised incorporating women and marginalised population in production process to uplift their living standards.

The revised policy has talked about prioritising aid for trade in trade-related infrastructure and trade facilitation to reduce the supply side constraints.

On the other hand, revised Trade Policy has also showed sensitivity towards quality control of the imported goods, and strengthening of laboratories.

Export incentives based on the scale of value addition, Bi-lateral Investment Promotion and Protection Agreement (BIPPA) with developed countries to attract foreign investment, and emphasis on vertical-specialisation are the other major highlights of the revised policy.