Kathmandu, March 30

A raft of non-tariff measures (NTMs) imposed by South Asian countries has been hindering the expansion of intra-regional trade in South Asia. The intra-regional trade of South Asia stands at just five per cent of the overall trade in the region.

Weak infrastructure, rules of origin criteria, lengthy documentation process, delays in clearance of goods and border security perspectives are widely considered to be the major barriers for enhancement of trade within region.

Along with these, various NTMs of individual nations have created obstacles in trade of goods despite the commitment of the South Asian nations to develop the region as a free trade area since 2006. The member states have not been able to make substantive progress and have been speaking about similar issues since the last decade, as per experts.

Speaking at a programme titled ‘Non Tariff Barriers in SAARC Region: Issues and Challenges’, organised by the Confederation of Nepalese Industries (CNI), today, former commerce secretary Purushottam Ojha said that NTMs in trade contradict the principle of transparency and simplification of trade procedures.

NTMs are accepted as defensive mechanisms worldwide to safeguard the consumers and domestic production base as well as environment protection through the means of quality check and anti-dumping and countervailing laws, he added.

However, NTMs in South Asia are different in nature. Citing the Asian Development Bank’s study a few years back, Ojha said that 86 per cent of such NTMs are related to sanitary and phyto-sanitary measures (animal and plant quarantine and food test related issues) and other technicalities.

Former secretary Ojha also suggested on establishing NTM desks for regular monitoring and reporting of NTMs and to use the information as the basis of lobbying and advocacy for removing NTMs in the region.

Prachanda Man Shrestha, an expert on international trade, highlighted the need to resolve the impediments in a holistic approach and suggested SAFTA committee of experts (SCoE) for the required preparation as the SAFTA ministerial meeting has been scheduled in the near future. NTMs are actions taken by individual countries, which in turn create barriers for trade known as non-tariff barriers, he added.

SAFTA has envisaged duty-free access of tradable goods, but the NTMs enforced by respective governments have proven to be a major barrier for the private sector involved in trade. Port access limitations, sanitary and phyto-sanitary measures, quantitative restrictions, trade of limited goods and other technical barriers have continued since long and efforts to minimise such barriers have not borne fruit, said Rajan Sharma, president of Nepal Freight Forwarders’ Association.

Also speaking in the programme, Sishir Kumar Dhungana, director general of Department of Customs (DoC), highlighted the efforts made by the Nepali customs to facilitate trade. DoC has been preparing for a web-based system for declaration of goods so that clearance of the cargo can be expedited.

Dhungana stressed on adequate infrastructure like roads, container freight stations and early completion of Integrated Check Posts (ICPs) that have already been initiated and most importantly, establishment of internationally accredited laboratories to address the issues of sanitary and phyto-sanitary measures. South Asian economies also need to be competitive to enhance intra-regional trade, he opined.