Kathmandu, October 5:

Nepal is seeking duty free market access for its exports, particularly agro-products, to Bangladesh, when senior commerce officials of the two countries meet in Kathmandu on Saturday and Sunday.

Nepal is also proposing a bilateral free trade agreement (FTA) with Bangladesh during the two-day long commerce secretary level meeting, as the volume of trade between these two South Asian neighbouring countries has remained significantly low despite enormous potentials.

Various issues related to non-tariff barriers, transit transport modality and effective operationalisation of Kakarvitta-Phulbari Banglabandh transportation corridor are also in Nepal’s agenda, a senior official at the ministry of industry, commerce and supplies (MoICS) told The HImalayan Times without wanting to be quoted.

“Tea and yellow lentils are in the Nepal’s list for duty free market access,” he added.

Purushottam Ojha, acting secretary at MoICS will lead the Nepali delegation and Feroz Ahmed, commerce secretary of Bangladesh will represent Bangladesh in the meeting. Ahmed has already arrived in the city with his five-member team to take part in the meeting.

Nevertheless many attempts made in the past to increase trade between Nepal-Bangladesh have not been successful, as the volume of trade stands merely below one billion rupees. Although trade surplus is in favour of Nepal, Nepali entrepreneurs complain about high tariff imposed on agro products by Bangladesh.

The bilateral trade between the two countries is still being guided by a Bilateral Trade Payment Agreement (BTPA) of 1976 and a protocol to the Transit Agreement (TA).

This agreement is automatically renewed every three year.

Nepal and Bangladesh signed a memorandum of understanding for a Free Trade Agreement (FTA) when commerce secretaries of the two countries met in Kathmandu in October 2002. But it didn’t materialise and the issue was again discussed in the sideline of the SAARC Summit in 2003.

“We discussed a lot about FTA and promotion of bilateral trade, but nothing concrete has come up yet,” said an insider.

Nepal exports agro products like yellow lentils, tea, green vegetable and industrial products such as cement, steel and instant noodles and imports pharmaceuticals, jute, garment accessories, tanned skin from Bangladesh.

The meeting is also likely to dwell on commonalities of regional FTAs of SAFTA and BIMSTEC, to which Nepal and Bangladesh both are parties.