Nepali export sector continues to falter

Himalayan News Service

Kathmandu, June 16:

Even after liberalisation of export trade for over 12 years, Nepal is yet to boost its market vis-a-vis other countries in the context of increased globalisation and privatisation of major economic sectors. The business of air cargo being carried out by freight forwarders is gradually losing its charm, due to increased competition, high security charge, increased surcharge and fuel surcharge. These charges are made even excluding airfreight bill. Freight forwarders have disclosed that Nepal’s total export air cargo business stands today at about 6,35,000 kg per month which is a fall by over 1,00,000 kg compared to previous years. Monthly cash transaction in air cargo business comes to be about Rs 132 million, revealed cargo sector sources.

In this connection, freight forwarders recently went to Udaypur in India to participate at a conference held by the Federation of Asia Pacific Cargo Agents Association (FAPAA) to join hands with FAPAA to bring Nepali freight forwarders at par with global players. In this connection, Nepali freight forwarders requested International Air Transport Association (IATA) certified trainers to come to Nepal to take care of dangerous goods, according to Nepali participants. FAPAA has also expressed willingness to help Nepal in its endeavor to boost air cargo business. Namgyal Lama, president of Nepal Freight Forwarders Association (NEFA), who led the delegation to India, informed that the 32nd executive council meeting of FAPAA was participated in by 16 countries from all over Asia Pacific who discussed in detail problems and prospects of respective countries.

Lama informed that as FAPAA members alone occupy more than 70 to 80 per cent of world’s air cargo business. Major stakeholders are China, Indonesia, India, Malaysia and New Zealand. The promotion of e-commerce was given importance for boosting export and freight forwarding at the conference, which is held every year. 80 per cent of the cargo going by air is exportable goods which is being properly exploited by others but for Nepal. This was discussed at length at FAPAA’s meeting in India, informed Lama. He said that 16 countries had expressed commitment to support Nepal in the promotion of its air transit facility. For this, infrastructure needs to be developed at par with international standards, Lama suggested.

FAPAA meeting concluded with the decision to exert pressure on airline operators to reduce airfreight, which will help in reducing exportable goods’ transportation fee, informed Lama.

“With the establishment of air cargo transit facility in Nepal, employment might go up. The government can get more revenues and business will flourish,” he said. After September 11, airlines have been charging more in the name of security surcharge, X-ray charge and fuel surcharge besides airfreight charge, alleged freight forwarders. Despite the freight rate being fixed at $3 per kg of cargo, airline operators charge more under other headings which comes to be about $4, complained Lama, while talking to The Himalayan Times. Sundar Dahal who owns Starlight Express Pvt Ltd said that Nepali freight forwarders have been encouraged with FAPAA’s meeting. Due to the phase out of duty free access on Nepali readymade garments to USA, the cargo/export business has gone down, he said. International recession has also contributed to this. Problems confronting air cargo/export are that facilities are less than what other competitors get, officials are not good and there is under the table dealing that has added extra cost to the prices, he said.