Kathmandu, July 27

As the country’s trade deficit has been ballooning every passing year due to low export base against surging imports, experts suggested focusing on development of high value and low volume products to narrow the export-import gap.

Some typical Nepali products branded as ‘produced in the Himalayan nation’ have unique selling proposition in the international market — Himalayan Organic Tea, Sherpa Adventure Gear, Himalayan Edition of Kobold watches, to name a few.

Himalayan Edition of the Kobold watches were sold at $16,500 each. The limited edition watches, which have been sold out, had garnered much attention for their dials made of the rock collected from the top of the Mount Everest.

Citing these examples, Swarnim Wagle, former member of National Planning Commission, said that developing high value and low volume products could be the paradigm shift in the country’s existing trade scenario.

It is tough for Nepal to establish itself as a low-cost economy due to several challenges like its land-locked status and high transport costs, erratic power supply and labour unrest, among others. In this context, the country cannot compete with the products from low-cost economies in the global market, as per Wagle.

He was speaking during the training programme organised by the Society of Economic Journalists-Nepal and Trade and Private Sector Development project under the Ministry of Commerce. In the programme, Commerce Secretary Naindra Prasad Upadhyay stressed that the country should enhance production base to boost exports and also be self-reliant on many products, for which the country has tremendous potential.

“High trade deficit due to rising import of consumable goods is of serious concern,” said Upadhyay.

Of the total imports, the country has been importing only 10 per cent as capital goods that are used to expand the production base and could ultimately help build the trade capacity of the country in the future.

The country’s export-import gap has been increasing substantially over the years.

The country’s export to import ratio was 1:2.2 in 2000-01, which widened to 1:6.2 in 2009-10. The gap further rose to 1:7.9 in 2013-14 and 1:11.2 in the first 11 months of the last fiscal.

If the gap keeps increasing in such a trend, the export to import ratio is projected to stand at 1:15 by 2019-20, which means the country would import merchandise worth Rs 15 against exports worth one rupee.