Himalayan News Service

Kathmandu, January 26:

Experts and businessmen have underscored the need to take key external and internal measures in Nepali readymade garment sector to remain competitive in the post-quota regime.

From January 1, the quota benefits received by Nepali readymade garment exporters, has been phased out and textiles and clothing trade have become part of the General Agreement on Tariffs and Trade (GATT) discipline.

Dr Shankar Sharma, vice-chairman of National Planning Commission, opined that Nepal should take key measures to remain competitive in the post-quota regime. He was speaking at a forum titled ‘Phasing Out of Textile Quota: Future Strategies for Nepal’, organised by South Asia Watch on Trade, Economics & Environment (SAWTEE) and Action Aid Nepal (AAN), yesterday.

Presenting a paper, Navin Dahal, research director at SAWTEE, said that measures to improve the competitiveness of the sector are very important. Given the precarious position of Nepali economy and the importance of the garment industry, he underlined the need for utilising preferential market access with favourable Rule of Origin (RoO) that will give a breathing space to Nepal.

Establishment of a Garment Processing Zone (GPZ) near the Inland Container Depot in Birgunj, establishment of a Technology Upgradation Fund to provide subsidised loan to the private sector to upgrade technology, procedural simplification to reduce cost and time are measures that need to be started immediately.

Giving an all-new regional dimension, Swarnim Wagle, programme specialist, Asia Trade Initiative, UNDP Regional Centre in Colombo, said that Nepal could learn from various other neighbouring countries and their strategies. Nepal can learn from the example of Sri Lanka’s brassiere industry, which has grown to a $360 million market. Nepal needs not only be a passive recipient but should proactively develop production and marketing for niche products, he added.

“Tools like excellent marketing and the ability to make use of Nepal’s comparative advantages would also make it possible to overcome the challenges in the post-MFA era,” Wagle said.

Purushottam Ojha, joint secretary at ministry of industry, commerce and supplies, said that the government is positive about establishment of GPZ but admitted that the progress has been very modest. He urged that the private sector and the government should work hand-in-hand in such a crucial situation rather than playing a blame game with one another.