FEATURES NEWS THE RISING NEPAL (DAILY)

Promoting Export Trade
Finding New Export Areas

By Khilendra Basnyat

TODAY, economic development has been the crying need of every country. However, it is virtually impossible to bring about economic development without developing export trade.

Despite efforts, Nepal’s export has been sluggish and unable to ensure take-off. Consequently, it is a poor trader as yet.

As a direct result of its disadvantageous geographical situation, Nepal has experienced difficulties in developing its foreign trade which is largely dependent on transit facilities provided by India.

Nepal’s trade was only with Tibet and India five decades ago. Actually, Nepal’s export to India after the restoration of democracy has been found to be increasing as compared to the earlier ones. This growth is due to the trade treaty signed with India in 2053 B.S. No doubt, the treaty has provided easy access of the Nepalese products to markets in India. However, Nepal has a big trade deficit with India.

Since there is an open border, it is natural that India has big import on the trade of Nepal.

Being a landlocked country, Nepal has to rely on India for many things. Since Nepal does not have direct access to the sea, the structure of the foreign trade of the country has been affected by India to a great extent.

In fact, the development activities of a landlocked country like Nepal dependent on foreign trade cannot remain unaffected by internal factors. For example, the events in the subcontinent did determine progress in the past years. Likewise, worldwide inflation, scarcity of materials and other related problems slowed progress.

Nepalese metal goods, ivory and woodwork can also play a notable role in export trade, especially in exports to the north. However, agricultural commodities placed an important role among Nepalese exports and the overwhelming majority of Nepal’s imports became processed goods. This gave almost monopoly control over her trade to India.

Nepal’s great potential skilled handiwork has been simply demonstrated by its industry and the craft goods to be seen all over Kathmandu. The cost of such handiwork so high in developed countries and so cheap in Nepal that even with transport costs added, this handiwork could probably be sold at thirty to forty per cent below the prices of such goods produced in Europe.

Although the consequences of the landlocked situation is difficult to quantify, Nepal’s lack of access to the sea is compounded by its remoteness and its isolation from world markets. Overall growth, export, expansion and utilisation of foreign capital resources generate demand for international transport services. More difficulties and the cost of these services hinder Nepal’s overall development.

In the present global context, developing countries’ goods and services should have access to developed countries’ markets. However, such products should be up to the standard and have demand in the markets. If necessary, developed countries could transfer technology to the developing countries so that the latter may use it and make them advanced technologically.

Since Nepal is located in the heart of Asia from where large population can be served the east as well as west, it is possible to attract foreign companies in those fields from different countries. Presently, few have already entered, but it is important that raw materials instead of importing should be produced in Nepal within specified time.

For export promotion, formulation and effective implementation of a long-term plan is the pressing need of the day. Apart from this, there is the need to produce quality goods and services as per the demand of the international market, revive all trading polices, construct a separate airport for cargo and develop multi-model transport. Also, there is the need for programmes for stabilising industries, coordination among different ministries and formation of an autonomous export promotional body with the representation of private sectors.

If water can be harnessed well, there is a possibility to export power to India and Bangladesh and reap much benefit.

Apart from this, hand-woven carpets, readymade garments, hides and skins, oil, medicinal herbs, pulses, rice, handicrafts, wood and bamboo products, handmade paper and leather goods are some of the chief exportable items of Nepal.

In order to promote export trade, private sector should be encouraged, banking sector and cooperative motivated and agricultural development carried out in the form of campaign.

Despite the fact that the Nepalese government has not made any explicit acknowledgement of the impending balance of payment, during the sixties it enumerated the goal of diversification of trade. This is undoubtedly an attempt to regain the economic independence that Trans Himalayan Trade provided Nepal in the early nineteenth century.

No doubt, the diversification of trade plays a significant role in promoting export trade. Actually, a true diversification of trade implies not only finding new markets but also new goods to sell. If exports to hard currency markets are to be boosted, new lines of production have to be studied and established, new and reliable marketing contact to be found. Such a work involves technical and marketing knowledge that is probably unavailable within the country and managerial know-how that is scarce.

For export promotion, Nepal has to start finding new export areas for its food products in the traditional nearby Indian markets. The possibility is Tibet in the north, which can absorb adequate quantity of cereal goods. Nepal can also export to Europe, Japan and Taiwan its herbal products and fruits and vegetables to the Middle- East.

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