Govt plans to boost exports to Rs 100b by fiscal-end
Jul 26, 2014-
The government has aimed at increasing exports to Rs 100 billion at the end of the current fiscal year. As of the 11th month of the last fiscal year (mid-June 2014) Nepal’s exports stood at Rs 81.82 billion.
The 13th plan targets to achieve Rs 100-billion exports by the end of the next fiscal year, but the government plans to meet the target a year earlier.
The government had targeted to attain that export target by the end of 12th plan (fiscal 2012-13), but it failed. So it kept the target unchanged for the 13th plan. At the end of the 12th plan, exports reached just Rs 77 billion.
Looking the current trend, the target looks achievable without maximum efforts. “Less ambitious export target was fixed with a view that it should be practically achievable,” said Toya Narayan Gyawali, joint secretary at the Ministry of Commerce and Supplies.
However, trade experts say the target is misguided. Trade expert Posh Raj Pandey said not fixing the target in US dollar terms is misguiding given the fact the domestic currency has depreciated heavily in the recent years. “Other reasonable options would be to maintaining the target based on the country’s gross domestic product (GDP),” he said. Comparing exports against GDP, Nepal’s exports performance has been disappointing. In last fiscal year, export volume against GDP stood at 4.8 percent against 10 percent in 2003-04.
Although the exports grew just 3.3 percent in FY2012-13, the growth rate in FY2013-14 (in first 11 months) stood at 16.9 percent. However, Pandey said despite a relatively better growth last fiscal year, it is still low in US dollar terms.
On the other hand, imports have risen massively, causing a trade deficit of Rs 564 billion as of the 11th month of last fiscal year, according to Nepal Rastra Bank. The imports rose to Rs 645.7 billion over the period. Estimated share of imports in GDP rose to 36.8 percent compared to 25.4 percent a decade ago, according to Economic Survey 2013-14.
The government has not announced many programmes to boost exports in the budget for the current fiscal year. The budget has talked about completing the dry port in Larcha, Sindhupalchowk, on which 70 percent work has been completed. Constructing another Inland Container Depot in Rasuwa, a quarantine office of international standards in Barhabise, Sindhupalchowk, are a few other measures announced by the budget.
According to the Annual Development Programme (Part-I) published by the National Planning Commission, the government aims to promote the registration of collective trademark of Nepali goods in additional countries this fiscal year.
Currently, collective trademark of Nepali pashmina has been registered in 47 countries, including the latest Brazil, South Africa, Russia, UAE and China.
Besides promoting domestic products, the government also aims to discourage dumping of foreign products by introducing anti-dumping, countervailing and safeguard laws.
The government has also aimed at increasing exports of each good under the Nepal Trade Integration Strategy (NTIS) to Rs 1 billion at the end of this fiscal year. Currently, exports of five goods out of 13 under NTIS stand at over Rs 1 billion. Iron and steel, cardamom and tea are among the products whose exports rose to more than Rs 1 billion in the last fiscal.
The government has also initiated discussions on amending products and services under NTIS as per the changed context. Currently, a team led by former joint secretary of the commerce ministry Prachanda Man Shrestha has been working on NTIS revision.
While revising NTIS, the government plans to remove low performing products and service and add products with high potential.
Highlighting the need for a revision to NTIS, Pandey export potential of Nepal-made readymade garments has increased due to rising wages in China and Bangladesh.
“If the government addresses the labour problem in the garment sector, there is a real chance of revival of this once vibrant sector,” he said. “On the other hand, Nepali agriculture products also have immense export potential provided India accepts testing of Nepali products in Nepali labs.”
According to the Commerce Ministry, it is currently working on strengthening labs owned by the Nepal Bureau of Standards and Metrology, Department of Food Technology and Quality Control and Quarantine Office. “The strengthening of the labs will help export promotion without hindrance from foreign countries over quality issues,” said Gyawali.
Published: 27-07-2014 09:24