US market crucial for Nepali textile sector’s survival

Himalayan News Service

Kathmandu, January 31:

As US is the biggest market for Nepali apparel and readymade garments, Nepali garment manufacturers are desperately looking to maintain their market share in US, following the quota phase-out for Nepali garments beginning January 1, 2005, minister for industry, commerce and supplies, Ishwor Pokhrel told at a programme held here on Monday.

Nepali apparel sector employs over 50,000 people and has been a source of livelihood to over 250,000 family members belonging to the low-income group. Therefore, the minister hoped, that US legislators will make it possible to pass a bill in favour of apparel and textile products from Nepal. Nepal being a landlocked and least developed country that is a pursuing democratic system of governance, deserves to get ‘special and differential’ treatment from the open, large and prosperous US economy, the minister said. Pokharel added that the government is interested in working jointly with US, said the minister. He stressed that the time is ripe to explore and develop appropriate bilateral arrangements to enhance trade between US and Nepal. US ambassador to Nepal James F Moriarty, said that following Doha negotiations in 2001, US has committed a total of four million dollars to the World Trade Organisation for trade-related technical assistance.

US is still continuing, said Moriarty, to offer exemptions for many imported goods from certain countries including Nepal, under the Generalised system of Preferences (GSP).

Ministry of industry, commerce and supplies, embassy of the United States of America, Nepal Chamber of Commerce (NCC) and Nepal USA-Chamber of Commerce and Industry, organised a programme on ‘Exports through US GSP Facilitation’.

US is the second largest importer of Nepali products in the world, said Moriarty and more than 25 per cent of Nepal’s total exports in the last year travelled to the US. “But sadly, nearly 28 per cent of Nepali imports that would have qualified for special treatment under GSP did not take advantage of the opportunity,” said he. He said that he was pleased to give the opportunity to Nepal to learn about the duty-free status provided by US for the importation of more than 4,600 products from 144 designated countries and territories throughout the world, including Nepal. Rajesh Kaji Shrestha, president of Nepal Chamber of Commerce (NCC) commented that the potential impact of the quota phase out is likely to be crucial for Nepal where about 100,000 people are engaged in the sector providing livelihoods to over 400,000 and has an investment of over Rs 6 billion.

Nepal enjoys preferential market access under GSP for about two thirds of its export commodities and almost every major importing country grants GSP treatment to Nepal. However, Shrestha said, the GSP scheme often excludes sensitive items that are exported by Nepal including carpets, readymade garments, etc.

Prasiddha Pandey, acting president of NUSACCI said Nepali exporters currently enjoy duty free treatment on all products, including textile items, under GSP (Generalised System of Preference) scheme in EU, Canada and Australia.

Although, more than 5,000 products are allowed to enter US under this head, the exclusion of textile items concerns Nepal. Industry secretary, Dinesh Chandra Pyakuryal since USA is a single largest market for Nepali garments, understanding of US GSP is crucial for Nepal and diversification products to boost export market.