Kathmandu, July 18:

The government of Japan is likely to accept Nepal’s proposal for promoting more than 22 exportable items to the Japanese market under Aid for Trade (AfT). The new political development in Nepal seems to be working on behalf of Nepal, giving its economy a boost in terms of foreign trade.

The proposal prepared by the ministry of industry, commerce and supplies (MoICS) has recently been submitted to the Ministry of Finance (MoF), identifying the list of exportable products.

MoF is the lead agency for handing aid matters in the country. In recent days, WTO has also started discussing ways to expedite implementation of AfT among all 32 WTO member least developed countries as per the decision of the sixth WTO ministerial meeting held in Hong Kong in December 2005.

The WTO meeting has decided to give aid to LDCs worth $10 billion to boost their weak economies under AfT. The proposal is being sent to the embassy of Japan here in Nepal for final approval soon, said a source at the MoICS on conditions of anonymity.

However, Japan has only allocated $2 billion to be given to 32 LDCs in a bid to boost their economies. Some of the products that Nepal has put forth are honey, sweet orange (junar), coffee, jute products, essential oil, medicinal herbs, rainbow trout and ginger to boost rural economy. However, Japan is interested to help in more than 22 exportable products under the one-village-one-product concept.

Japan initially started one-village-one-product concept in 1979 which is now becoming more popular in other countries. Not only that, Nepal government has also picked up the idea of developing one-village-one-product concept in the fiscal year 2006-07 budget to boost exportable products such as lapsi, junar, rainbow trout and bell from districts like Bhaktapur, Rasuwa, Nuwakot, Sindhuli and Rasuwa.

Current exportable Nepali products for Japanese consumers are handicrafts and agricultural products. The Japanese aid is being used for people who are involved in export sector such as skill training, processing, product development, packing and standardisation of product. Similarly, Nepal government is also raising the issue of boosting marketing mechanisms for products made by Nepali manufacturers following the initiative of AfT.

However, other countries such as the US, European countries are yet to prepare a list under WTO provisions for LDCs as per their commitment at the WTO Hong Kong meeting. Initially, US had proposed to give one million dollars to Nepal but that is yet to be finalised.

Verbally, the US and EU countries have already hinted that they would focus their aid on Nepal to boost exportable products’ development, infrastructure development, institutional development and removal of export barriers.