Kathmandu, December 3:

Over the past one year, half of Nepal’s global buyers have taken their business to Vietnam, due to political instability and Maoists interference in various garment and carpet factories across the country here.

Despite the peace accord having been signed between the Maoists and the government, it is getting difficult for the business community to revive business deals with global buyers. The time is running out for Nepal to overhaul its trading sector, for which concerted efforts from the ministry of industry, commerce and supplies seem to be urgent, commented experts from the business sector.

Namgyal Lama, president of Nepal Freight Forwarders Association (NEFFA) disclosed to The Himalayan Times that in recent times, Nepal’s buyers have been diverted to Vietnam as we could not compete in the global market, particularly in relation to maintaining delivery schedules. He said that the Maoists have started to interfere in garment and carpet factories that have sent a bad message to the global market about Nepal.

As per the latest figures of Nepal Rastra Bank (NRB), the growth rate of exports to India has declined to 0.6 per cent in comparison to a 34.7 per cent rise in the same period compared to the previous fiscal year. Similarly, exports to other countries have also declined by one per cent during the period.

Lama expressed concerns that Nepal’s buyers had changed their destination to India and Indonesia, besides Vietnam, as products from these countries reach destinations on time and are competitive as well.

Raju Shrestha, president of Export Council of Nepal (ECON) told The Himalayan Times that the decline in exports to India and other countries will further increase as the market is becoming increasingly competitive. We are not delivering our products on time to global buyers that has affected our business, commented Shrestha.

He disclosed that big companies have changed their interests about working with Nepal. The issues of regularity and other issues related to quality have adversely affected our exports, he mentioned.

Shrestha, the top Nepali exporter for 2005-06, commented that his buyers have also decreased from 1,500 and the immediate future looks bleak.

Lama informed that more than 200 garment units have already closed down due to insecurity earlier. “Not only that, Maoist trade unions are now creating trouble in these factories,” Lama grumbled.

Meanwhile, Indian exports have increased by over 22 per cent. Export of polyester yarn, plastic utensils, zinc sheet, wire and cattle feed to India has declined, according to NRB. Similarly, export of woollen carpets, silverware and jewelleries and handicrafts to other countries has also declined. The current year’s trade deficit has increased by 14.5 per cent.