The southern neighbor has also not responded to Nepal´s query on when Indian Commerce Minister Anand Sharma could visit Nepal to formalize the deal. This has pushed the enforcement of the treaty, which has pledged non-tariff preferences and additional trade facilitation support for Nepal, into limbo.
The two sides had put initials on the treaty amid mess and only after removing a contentious provision of re-export of third country goods to each other´s territory on August 22. For it to come into effect, the commerce ministers of both the countries need to officially endorse the document.
Ministry of Commerce and Supplies (MoCS) had sent a formal invitation to the Indian minister, citing that September 9 and 10 could be the convenient dates for Nepali Commerce Minister. The ministry had set the dates, keeping in view the Nepal visit of Confederation of Indian Industries´ (CII) business delegation during the period. “It would have made the signing ceremony great,” said a source.
But India not only did not respond to the call but has also not proposed possible dates.
Officials at the MoCS assume that India might have pushed the signing ceremony down on its convenient time because it is intensively engaged in World Trade Organization (WTO) talks. The officials told myrepublica.com that the ministry on Thursday sent a letter to the Nepali Embassy in New Delhi to follow up the issue and request India set an early date for activating the treaty. It has also communicated with the Indian Embassy in Kathmandu to make arrangements for the same at the earliest. “We are hopeful that the treaty will be signed within this month,” said the source.
The revised treaty is an outcome of two-year long negotiations between the technical committees of the two countries and provides additional trade facilities for Nepal. For instance, India, in the new treaty to be valid for seven years, has agreed not to impose extra-customs duty and non-tariff barriers on Nepali goods. This is expected to boost Nepal´s export to India.
Imposition of non-tariff and extra-customs duties, which debilitated Nepal´s competitiveness, has been badly affecting Nepal on the exports front. Sharp rise in consumption, on the other hand, has caused its trade deficit to widen to more than Rs 108 billion.
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