Amendment to Indian Drug Act may squeeze Nepali exports

By Sameer Ghimire

KATHMAND, Feb 20 : With the Indian government planning to enforce an amendment to its Drug Act, Nepali drug manufacturers are likely to face yet another blow while exporting their products to the Indian market. The Nepali drug exporters are already feeling the heat to export domestic products to India due mainly to complicated export procedures.

The new amendment to the Indian Drugs and Cosmetics Act 2001, which will come into effect from March 1st, 2003, has introduced a robust surge of various fees, making the exports of Nepali drug products to India well-nigh impossible.

As per the amendment to the Act, the registration charge for any drug company intending to export their products to India has been raised 30 times higher than the previous charge, fixing it at US $1500, says Pradeep Jung Pandey, former president of the Association of Pharmaceutical Producers of Nepal.

Along with the high registration charge, the amended Act has also imposed different new fees including factory inspection charge amounting to US $ 5,000 and quality examination fee of US $ 1,000 to each new brand of the foreign drug that are exported to India. Until now, Nepali drug exporters are not required to pay such heavy fees.

"The already nominal drug export to India would surely be badly affected by the new amendment to the Act as it intends to restrict drug imports to India through the imposition of various new charges," said Pandey.

Nepali drug manufacturers are worried that the imposition of additional charges would greatly erode already fragile competitiveness of domestic drug products in the Indian market, he added.

While the Indian drugs can enter Nepali market quite easily, the Nepali drugs have to pass through a longer and difficult route to penetrate into the lucrative Indian market. Due to the various complications, Nepali drugs generally take six months to enter Indian market, concerned entrepreneurs say.

The undue lingering is mainly made by Central Drug Lab of India in examining the quality of foreign drugs. "Such undue delay owing to lengthy batch-wise examination has been discouraging to Nepali drug exporters," added Pandey.

Along with the drug industrialists, the senior government officials also flay the delay. "The lengthy quality checking of our drugs by Indian Central Lab has been sending wrong signal to our exports," said Bhupendra Bahadur Thapa, chief of Department of Drugs Adminstration (DDA).

With the new amendment coming in effect soon, the DDA, which is entrusted with ensuring the flow of quality drugs into Nepal, is also planning to enact similar provision for foreign drug companies while entering into Nepal.

"We have already proposed the government to enact some provisions that would check the quality of foreign drugs while entering into Nepal for domestic consumption," said Thapa.

As of now, foreign drug companies are required to deposit only NRs 50,000 as registration fee to acquire the licence, which allows them to enter Nepali market. Along with the licence, foreign companies need to produce WHO-GMP (World Health Organisation- Good Manufacturing Practice) licence to the DDA of Nepal to penetrate Nepali market.

Nepali drug companies only contribute 27 per cent of total drug demand to Nepal, which is a market of annual turnover of around seven billion rupees, and employ over 25,000 people.

China Garden introduces Working Lunch

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KATHMANDU, Feb 20 : China Garden, a Chinese restaurant at Soaltee Crowne Plaza, with an objective of catering to its busy customers with delicious Chinese dishes at a very competitive price has introduced the concept of Working Lunch.

According to Jugesh Shrestha, Assistant Director of Sales, the hotel has introduced the concept targetting simplicity, value for money and promptness. ‘Working Lunch’ was launched after receiving feedback from a survey commissioned among 850 plus frequenters to different restaurants of the hotel.

The lunch with three-course menu with options is lighter than the usual ones and is very suitable to the wallet and to the taste of executives who find very little time for lunch, he said.

The concept will come into effect from February 21 and will last for a short period but it will be rotated into other restaurants of the hotel to give continuity to their scheme, he said. The restaurant offers wide range of tasty dishes in a very wonderful environment.

China Garden is the brainchild of Nelson Wang, a leader of a rare and dwindling breed of Chinese master chefs, and the China Garden at Soaltee is the first venture outside India and second in his list of restaurants.

Nelson Wang and China Garden have received recognition from various organizations and countries. Adjudged as the ‘Cleanest and Most Hygienic Restaurant’ in 1993 and 1994, the restaurant was praised by The New York Times too. China Garden has also been selected as the Best Restaurant in Asia from establishments surveyed in 80 cities in 23 countries, states a press handout.

Few industries registered in first half of current FY 

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SARLAHI, Feb 20 : Increased Maoist activities adversely affected the industrial activities in the district and the rate of registration of new industries slid sharply during the first seven months of the current fiscal year.

According to a figure issued by the Office of Cottage and Small Industries (OCSI), just 101 new industries were registered in the first seven months of the fiscal year, while it was 155 during the like period last year.

"This has badly hit the employment and economic activities of the district," said Krishna Bahadur Karki, chief of the OCSI. Last year, a total of 222 industries were registered in the district which was said to have generated employment opportunities for 285 persons.

Going by the latest trend, both these figures would decline sharply this fiscal year, he added. Officials at the OCSI stated that the increased Maoist activities in the district were the reason behind the decline in industrial activities in the district. "Investors are just scared to risk their money in the existing industrial environment," they said.

The OCSI has an authority to register industries up to the size of Rs 30 million. "While the people having money are preferring not to invest, local people are compelled to look for alternatives like going abroad for employment," according to officials.

Brick kilns, mills and saw mills, among others, are the major industries registered in the district, which have been absorbing a substantial number of human resources. Nonetheless, officials express hope that the latest development seen in the peace process would change the scenario.

Oil price surges but inflation remains at 2.1 pc

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KATHMANDU, Feb 20 : Anchored by low price increment in both food and non-food groups, the overall inflation rate continued to remain in low ebb, offering some relief to the economy facing a series of hardship since last year.

According to Nepal Rastra Bank, during the first five months of the current fiscal year, the National Urban Consumer Price Index (NUCPI), registered a low increment of just 2.1 per cent against 2.7 per cent recorded during the same period last year.

During the period, food and beverages items, which commands 53.20 per cent weight in the NUPI, registered a minimal rise of 1.7 per cent whereas it was 4.1 per cent during the same period last year. Among the major items of the group, grains and cereal products registered an increment of 7.8 per cent as opposed to a marginal increment of just 0.2 per cent observed in the same period last year.

Since grains and cereals products alone holds 18 per cent weight in the overall index, any fluctuations in its price plays an influential role in determining the inflation rate by suppressing price fluctuations of goods that commands low weight.

Low production of paddy, which commands a lion’s share in the food and beverage group, due to the adverse weather condition both in the Terai region and neighbouring Indian states, largely contributed to the price increment of 6 per cent in rice and rice products against a deflation of 1 per cent during same period last year. Similarly, lessening inflow of cheap Indian rice into the country mostly through illegal channel also played an important role in pushing up the price of rice.

Since most of the economic activities of the rural sector heavily depend upon the income of monsoon crops, the price increment would have a positive impact, as enhanced incomes would boost the demands of goods and services in the rural sector. The dwindled income of majority farmers owing to paddy price crash recorded last year was one of the prime causes for the record-low demand of goods and services.

Similarly, the prices of vegetables and fruits, which is the second largest weight holder in the group recorded a double-digit price tumble of over 14 per cent against a surge of almost 18 per cent during same period last year. Heavy inflow of vegetables from India and growing attraction of local farmers are some of the major reasons for the price slip.

Buoyed by the recent sharp price rise in oil and ghee in India, their prices in Nepal also followed the same trend and recorded a robust rise of over 20 per cent. Likewise, the price of pulses recorded a marginal price rise of one per cent while the price of meat, fish and eggs, and milk and milk products also went up by 4 per cent and 0.1 per cent respectively.

Similarly, marginal price increment of 1.7 per cent was recorded for restaurant meals, whereas such increment, during the same period last year was 2.7 per cent.

The price of beverage products, during the period, recorded a price rise of 8.5 per cent whereas it was just close to five per cent during the same period last year. However, the price of spices, though it holds a nominal weight, recorded another double-digit plunge of 13 per cent during the period. Since most of the spices are imported from overseas, the downfall in international price results in such a heavy price decline in the country.

Similarly, the non-food and services group, which bear 46.80 per cent weight in the national price index, registered a moderate increment of 2.5 per cent. Of the commodities incorporated in the group, prices of medical and personal care recorded the highest rise of 4 per cent whereas such rise was 7 per cent during the same period last year.

Similarly, the index of housing, which holds the largest weight in the non-food group registered a low growth rate of 3.5 per cent from a deflation of 2.1 per cent recorded during the same period last year.

In the like manner, clothes, clothing and sewing services, education and reading materials, and tobacco and related products also registered marginal increments of 1, 0.9 and 3.5 per cent respectively.

Dhankuta losing business charm

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KATHMANDU, Feb 20 : Not a single truck is loaded or unloaded in Dhankuta. Despite being the headquarters of the eastern development region, the size of the market is and small, interestingly, the demand and supply chain is maintained constant throughout the year. Businessmen here bring the goods on truck en-route to Hile or Basantapur, and there is no need to bring in goods in a hurry or in a substantial quantity.

The major consumers of Dhankuta are students, government employees and private employees. Their numbers have remained almost the same for a long time. There is no variation recorded in the type and quantity of goods consumed. As the consumption capacity of both these groups are relatively on the lower side, the change in trading value is not visible.

On the other hand, the local people go to Dharan, Biratnagar and Indian bordering market of Jogbani for purchasing expensive goods. Relatively more goods are brought in Hile, Pakhribas, Sidhuwa, Basantapur, Mudhe, Lasune, Jirikhimti and Myanglung. The transaction at these places are higher than those in Dhankuta market.

For the locals, house rents fetches good money and is a more sustainable source of income than the business. Landlords invariably find their houses occupied throughout the year due to a large number of employees and students.

Despite low business, shops in Dhankuta are higher. Over 150 shop are enlisted in the Dhankuta Chamner of Commerce and Industry (DCCI) alone. But owing to the constant business maintained throughout, they do not find the return varying.

"Shops are opened just for passing time," said Binod Kumar Pradhan, former President of the DCCI. As the shutters of the houses adjoined to roads are rarely rented, the owners themselves prefer to open the shop rather than keeping their houses idle, say locals. They further said that the daily transaction of the shops rarely cross Rs 1,000.

None of the shops have warehouses or keep inventory. Shopkeepers bring in goods in small quantities and sell it directly from their outlet. Although larger shops have been opened since last year, their businesses are no better.

Previously, the market was more busy, crowded and trade volume higher a few years back. In the absence of roads, Dhankuta market used to be the largest business centre and entry point for goods to hilly areas. With the construction of roads, now the traders from hills too directly buy goods from other larger markets and even the locals prefer to secure the supply from other key markets.

"The market, once largest in the area, is shrinking rapidly after the locals started to go to Dharan for shopping," state local businessmen.

Martin Air to replace ‘Dutch Connection’

KATHMANDU, Feb 20 (PR) - Martinair from the Netherlands will operate a weekly flight from Amsterdam to Kathmandu, says a press release issued here today. It further says that the flight will be replacing the ‘Dutch Connection’ of Transavia Airlines, which will be discontinued from April.

This was disclosed at a programme organised by the Nepalese Embassy to mark Nepal’s 53rd democracy day. Transavia Airlines is stopping Kathmandu operation due to its cost cutting and strategic reasons, said Cas de Stoppelaar, Nepali Consul General speaking on the occasion. "However, Martinair’s alternative is much better, as it is a bigger airline," he said.

The weekly flight schedule of the Martinair in the country is to start on October 8, 2003, informed Sander Heijmans, Senior Vice President of Martin Air. "However, it depends on the final approval of the Nepalese authorities," said Heijmans, further stating that the flight could be made a success, as Amsterdam is well known for its excellent transit facilities with fast connection to Europe and the USA.

Yogendra Shakya, board member of Nepal Tourism Board (NTB), meanwhile, expressed satisfaction over the announcement of Martinair flight from Amsterdam to Kathmandu. "This is indeed a very good news for the ailing tourism industry in Nepal," he said, adding that the Dutch have always contributed substantially to Nepal’s tourism.