CVD imposed by India affects jute exports

Published On: January 3, 2017 12:40 AM NPT By: Ajit Tiwari

BIRATNAGAR, Jan 3: Six industries of Biratnagar have been affected after India imposed a huge Countervailing Duty (CVD) on jute being exported to its territory. 

India is the major market for Nepali Jute. Jute traders say that imposition of CVD on jute products is against the Nepal-India trade agreement.

The Indian government starting imposing a 12 percent tax on jute imported from Sri Lanka, the Maldives and Nepal from December 15. 

Nepal-India trade agreement says that jute industries of both the countries should be treated equally.

Before December 15, India was charged only 1 percent tax on Nepali jute. 

Ramesh Rathi, president of Nepal Jute Mills Association, said that the Indian decision has hit jute industries hard. “Jute exports have been affected since the day the decision was taken,” he added.

According to Rathi, six industries of Morang-Sunsari Industrial Corridor has been exporting jute to India. “India is our big market. We cannot run the industry paying such a huge tax,” he added.

The Indian government has imposed 12 percent tax on ready-made jute products, Asian cloth and jute sack. But it has not imposed any tax on sutari thread which is made from jute. 

According to Rathi, around 12 to 15 truckloads of jute products were being exported to India on a daily basis until December 15. The export, however, has come down to zero after CVD was imposed.

Rathi also said that Nepali traders have event visited the Indian Finance Ministry to discuss about CVD imposed on Nepali jute products.

SB Sinha, senior superintendent of Indian Customs Office at Jogbani, said that the Indian government was making preparation to lift CVD imposed on Nepali jute. “The decision is actually made for Bangladesh, Sri Lanka and the Maldives,” he said adding.

An officer of Indian Customs Office, Jogbani, said that the Indian government has issued the same circular for all countries. “We have not blocked export. The export has been affected by the circular by our government. We are working to remove it,” the officer added.

The officer also said that the Christmas and New Year holiday has delayed the process to lift the CVD imposed on jute products.

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