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Kathmandu Monday July 24, 2000 Sharawan 09, 2057.
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Nepal-EU agreement on textiles not pesky
By
a Post Reporter
KATHMANDU,
July 23 - The provision contained in the agreement between Nepal and the European Union
(EU) requiring license for the export of textile items to Europe is free from hassles
contrary to initial doubts expressed by exporters.
As
per the agreement, reached on March 26, 1999 and fully enforced from March 1, 2000, a
competent government office should issue license for textile exports to Europe and endorse
Certificate of Origin (CO) of exportable items.
The
Department of Commerce (DC) presently issues the license and endorses the CO.
Businessmen
had strongly voiced against the agreement initially fearing administrative hassles and
bureaucratic interference in export business.
Udaya
Raj Pandey, Secretary General of Garment Association of Nepal (GAN) says although the
agreement increased documentation requirements, it has proved beneficial to the exporters.
"Before
the agreement was implemented, garment exports to Europe was meagre. However, the
enforcement of the agreement and the resumption of the GSP subsidy granted by the EU
to Nepal from March 1, 2000 has increased the exports significantly," he says.
He,
however, adds that complying with DC requirements for obtaining export license has created
problems to trading firms.
"The
response from the business sector now is positive as opposed to the initial skepticism
shown by them," says Krishna Hari Baskota, Director General with DC.
The
agreement requires the entrepreneurs to obtain license for the export of textile products
under five categories, of total 161 categories as classified by EU, for the purpose of
dual checking of goods exported from Nepal.
The
five categories numbered 4, 5, 6, 7 and 26 include the major exporting textile items such
as shirts, T-shirts, light weight fine knit roll, jerseys, woven breeches, shorts, other
than swimwear and trousers, blouses, jumpers and pullovers made of wool, cotton or
man-made fibres among others.
The
DC issues license to exporters only upon producing the order of goods or the receipts of
advance payment made by the European importer to the Nepali exporter or if there exists a
back-to-back arrangement or buy-back arrangement.
Similarly,
DC endorses CO, which is forwarded by Garment Association of Nepal through the local
Chambers of Commerce.
Within
a span of four and half months, the Department has issued 2,114 licenses, worth Rs 436.13
million rupees. Similarly, it has issued 4,439 certificates of origin worth Rs 538.53
million. Certificates of origin worth Rs 524.23 million was issued for items falling
within the five license requiring categories while the rest was issued for those falling
under other 156 categories.While the licenses were issued for the export of almost 2
million units of garments to the European market, the certificates of origin were issued
for the export of 2.74 million units.
"Businessmen
have realized that the license issued by the Department and the endorsed certificate of
origin not only helps them in proving the originality of their exported items but also in
convincing the EU on quality," says Baskota.
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