Kathmandu, September 29
With an ambitious target to increase the export of NTIS products to around four per cent of the gross domestic product (GDP) by 2020, the Ministry of Commerce (MoC) today unveiled the updated Nepal Trade Integration Strategy (NTIS) 2016. Currently, export of NTIS products is around two per cent of the GDP.
The NTIS-2016 was launched by Minister for Commerce Romi Gauchan Thakali. The revised NTIS envisions creating an enabling environment for trade by strengthening the supply capacity as well as institutional capacity development of trade-related institutions. Capacity enhancement of trade-related institutions could be highly supportive in reducing cost of trade through initiation of various measures. The strategy has set immediate
targets that need to be achieved by 2017 and medium-term targets by 2020.
The country’s export sector has been lagging due to supply-side constraints. This, in turn, has resulted in country facing huge trade imbalance.
Commenting that the updated NTIS 2016 is ‘realistic’, Member of the National Planning Commission (NPC) Swarnim Wagle said, “Since the beginning of the new century, the country’s export has been slowing due to supply-side incompetencies, deficiencies on the regulatory front, and less than optimum cooperation from the government.”
Wagle talked about some Nepali products that have done amazingly well in the international arena by efficiently branding their products. He cited the examples of some ‘high value to weight ratio’ products like Kobold watches, Sherpa Adventure gear, organic tea, software and creative apps and ophthalmic lenses developed by Tilganga Institute.
“The priorities set by the NTIS are in tandem with the potential of Nepali products,” Wagle opined.
He further said that Nepal as a young populous country should not skip manufacturing and rather focus on reviving the manufacturing sector, especially along the Tarai belt. He also highlighted the possibility of creating mass employment by linking up the industries set up in Nepal with Indian production networks as well as regional and global value chain.
He also stressed on the need of complementary reforms. “Reform and industrial enterprise development, foreign direct investment, labour reforms, logistic industry development, our ambition in tourism — all things need to be taken simultaneously,” he stated.
Horizontal reforms or high quality improvements in entire sectors at the same time could be almost impossible for a country like Nepal, which is when anchor investment could be the next best option and Nepal is also focusing on the second alternative, like the special economic zones, targeted investment approaches, according to Wagle.
In the launch ceremony, Commerce Secretary Naindra Prasad Upadhyay said his ministry has been playing a role of the coordinator to bring all the stakeholders together. Implementation of strategy as well as supply capacity enhancement is the ‘shared responsibility’ of all stakeholders including private sector, he said.
NTIS has identified some products and services with comparative and competitive advantages. NTIS, which was introduced in 2010, had incorporated 12 products and seven services under export priority. However, the list has been changed in NTIS 2016.
The NTIS 2016 has shortened the list of products and services that have niche market advantage. NTIS 2016 has identified five products, namely carpets, leather products, pashmina, footwear and all types of fabrics (textiles, yarns) under priority export items. Similarly, three categories of services — skilled and unskilled labour; information technology and business process outsourcing; and tourism — have been incorporated as priority sectors for enhancing export trade.
Enhanced Integrated Framework — the aid for trade mechanism of World Trade Organisation and various other donors for productive capacity enhancement of least developed countries — has been providing support for NTIS implementation.
A version of this article appears in print on September 30, 2016 of The Himalayan Times.