Duty-free access for RMG major agenda

KATHMANDU, April 11: The government will ask for easy access for Nepali goods to the American markets, including reintroduction of duty- and quota-free regime for Nepali readymade garment (RMG), during the first ever meeting of the Nepal-US Council on Trade and Investment (NUSCTI) to be held in Washington DC on April 15.



Deputy Prime Minister and Finance Minister, Bharat Mohan Adhikari, who is also assuming the Minister for Commerce and Supplies portfolio, will sign the Trade and Investment Frame Work Agreement (TIFA) along with US trade representative Ron Kirk. TIFA envisages establishment of a forum for bi-lateral trade and boost US investment in Nepal.[break]



“We will apprise them of the pitiable condition of Nepali RMG after the phase out of their duty-free-quota-free access to the US market and ask the US government to re-introduce the facility in order to give a new lease of life to Nepali apparel businesses,” a high level source at the Ministry of Commerce and Supplies (MoCS) told Republica on Sunday. After the end of duty-free-quota-free regime, the US has been imposing 17 percent duty on Nepali RMG -- the largest export item to the US market.



Nepali embassy in the US had filed a petition on behalf of Garment Association-Nepal (GAN) a few months back demanding General System of Preference (GSP) for major Nepali exports including RMG.



“We will also seek technical assistance for strengthening Nepal´s Intellectual Property Rights and its capacity to export goods identified in Nepal Trade Integration Strategy (NTIS),” said the source.



Nepali delegation will also seek US assistance on mapping Nepal´s bio-diversity products and assessing the prospect of exporting them.



At a separate meeting, the Nepali delegation will meet investors to discuss the US investment in Nepal´s hydropower sector at a time when the government has declared energy emergency.



Deputy PM Adhikari is scheduled to make a presentation about the prospects of investment in Nepal highlighting the legal regime, facilities and government mechanism to facilitate the foreign investment.



The US cancelled the duty-free quota-free access to Nepali RMG in 2004 December, a move that devastated the booming apparel industry resulting Nepali RMG producers and exporters to wash their hands off the business.



TIFA, a forum to discuss and resolve trade and investment issues, also serves as political and legal commitment to enhance bilateral trade and investment.

Once signed, it is expected to give a new momentum to Nepal´s trade with the US that has hit rock bottom.



The agreement has seven articles related to trade, investment and technical assistance. It provisions establishment of commerce secretary-level NUSCTI as a permanent mechanism for regular bi-lateral meeting to explore measures to expand trade and investment.



The meeting will assess the existing GSP for Nepal´s exports in relation to the preference coverage, preference utilization and erosion of the preference margins.



GAN has also urged the government to lobby to get approved the petition it submitted to the United States Trade Representatives (USTR) through Nepalese Embassy in 2010 to get select apparel products that are eligible under GSP regime.



Once signed, TIFA will replace the bilateral Economic and Trade Agreement (ETA) Nepal and the US signed in 1947, paving way for preferential facilities for Nepali exports to the US.

Related story

Thai embassy organizing "Journey to Thailand & Top Thai Brands...