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Kathmandu Thursday July 26, 2001 Shrawan 11, 2058.
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Nepal-India trade talks next week
By Bhaskar Sharma
KATHMANDU, July 25 Secretarial level government officials
from India and Nepal are scheduled to meet next week for settling the various disputed
bilateral trade issues and sorting out the problems arising in the effective
implementation of the 1996 Indo-Nepal Trade Treaty.
The delayed secretarial meet, scheduled for August 1-3, which
is being held after a span of a year and a half, will be participated in by officials from
the Commerce Ministry of both countries.
The meeting is likely to discuss a wide range of issues that
have caused friction between the two trading partners in the past years. Ranging from
investment to trans-shipment, the meet is likely to cover all disputed trade issues.
Officials at the Ministry of Industry, Commerce and Supplies
informed The Kathmandu Post that both the parties are likely to reach an agreement
regarding the security of future Indian investment into Nepal. Though Nepal has reached
such agreements with at least five different countries, no such agreement has so far been
reached with India, the largest foreign investor in Nepal. "While India has been
pressing on the issue (agreement on investment security), Nepal too is positive. The
agreement may materialize this time," said a high-level official. The agreement would
be of special significance in the context of increasing attacks against business
establishments in recent months.
Another issue that is likely to be debated upon is the issue
of quality of goods. While exports to India require proof of quality, non-recognition of
the Nepal Standard mark has posed problems for Nepalese exporters. Though the two sides
have undergone a series of meetings aimed at recognizing Nepal Standard mark in India, at
the same time giving due recognition to ISI mark in Nepal, no agreement so far has been
concluded.
Besides, officials said that the Nepalese side will also
press for concluding the Railways Agreement, due to which the operation of the largest
Inland Container Depot (ICD) at Birgunj was delayed. The construction of warehouses at
Calcutta and Haldia ports, and their operation, would come as the other major point of
discussions, officials revealed. Transit costs for Nepal while carrying out foreign trade
with third countries are expected to go down by almost 40 per cent once the Birgunj ICD,
which will have railways linkage with Calcutta and Haldia, becomes operational.
Furthermore, Nepali officials informed that the issue of
quarantine checks imposed by India upon the export of agro-products from Nepal would also
be drawn up in the meeting’s agenda. India has continued to impose the quarantine
duty despite West Bengal Chief Minister Buddha Dev Bhattarcharya’s statement recently
that the imposition of the quarantine duty is illegal.
On the other hand, government officials here opined that the
Indian side is likely to include unauthorized trade from Nepal as its main agenda for the
meet. India has time and again accused Nepal of transshipment of third country goods to
India. Not just the cheap Chinese products, even high value products imported from abroad
are exported to India after minimal value addition, Indians have repeatedly complained.
Among the hit list of such goods, include zinc oxide, synthetic yarn and copper wires. As
a check to this, the Indian side has already proposed for increasing the minimum value
addition ceiling to 30 per cent for those goods that would enjoy free market access to
India, it is learnt.
Although high level government officials claim that the meet
is an annual event held with the objectives to pointing out the difficulties arising in
the execution of the treaty, it seems likely that review of the treaty may make up to the
meeting’s agenda. Especially because the meet comes five months in advance of the
proposed review of the 1996 Indo-Nepal Trade Treaty, which contains a provision allowing
its review or termination by giving three months prior notice by either of the contracting
parties.
The treaty, which has played a central role in strengthening
the Indo-Nepal bilateral trading relations, expires on December 31, unless ratified by
both the governments on December 5. The Indo-Nepal Treaty is of special importance to both
the countries since both have benefited from it. While exports of Nepal to India within
two years of the implementation of the treaty surged by over 80 per cent, imports of
Indian goods into Nepal at the same time rose tremendously.
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