National 5 (Spotlight Weekly)

Challenges And Opportunities

Experts and government officials agree the country needs to tread with caution to extract gains from the multi lateral trading system

By A CORRESPONDENT

Challenges are looming large on the country’s economic horizon following the decision to join multi lateral trading systems including the WTO, SAFTA, BIMST-EC and so on.

Experts say that outright liberalization of custom barriers could bleed the nation’s revenue as it still depends heavily on customs. “Unlike developed countries like USA, which will lose only 1 percent of their revenue by liberalizing customs, Nepal stands to lose staggering 20 percent by doing so,” said Dr. Hiramani Ghimire, chief advisor, Management Research and Training Academy, presenting a paper at a program organized by South Asia Watch on Trade, Economics and Environment (SAWTEE) and ActionAid Nepal (AAN).

Purushottam Ojha, joint secretary at the Ministry of Industry, Commerce and Supplies, agreed that the current export-mix of the country was not favorable in the long run. “Our foreign trade is characterized by heavy concentration on few products – readymade garments and carpet accounted for 60 percent of all export earnings; and limited import and export destination,” he said. “Nepal’s export has remained volatile largely due to limited market and limited products in the export baskets.”

With the ratification of WTO by the government, the country now is on the verge of becoming a full-fledged member of the global trading regime. “The strategic location of Nepal between two large economies India and China should be turned into our advantage. The combined market of over 2 billion people is in our neighborhood. We must try and exploit the potentials to our benefit,” said Dinesh Chandra Pyakurel, Secretary at the Ministry.

Secretary Pyakurel sees the urgent need to diversify market in order to gain from the trading regime. “We must grab the possibilities of market access thrown by these regimes,” he said.

In order to modernize country’s trading systems and practices and to fine tune them in accordance with the emerging trading regimes, the government is taking a number of steps. “Setting up Special Economic Zones, Export Promotion Zones; identifying additional transit routes are some of the initiatives being taken by the government,” said Ojha, adding, “Besides, we are also coming up with new investment policy, industrial enterprises policy, custom reforms soon.”

As experts and officials agree that efforts must be made on war-footing to orient the country’s policies in line with emerging challenges, the government as well as private sector now have little time to prepare themselves.

NTC Becomes Nepal Telecom

Beginning the new year’s day Baisakh 1 (April 13) , government-owned Nepal Telecommunications Corporation (NTC) has been transformed into Nepal Telecom - a company.

The move is a part of government strategy to privatize even profit-making enterprises. The NTC had been formed five decade ago and it had been functioning as public corporation since last three decades. After it has been transformed into company, preparation are on to bring in foreign consultants. “Based on report and suggestion of the consultant, the organizational structure of the NTC would be strengthened,” said managing director Sugat Ratna Kansakar.

The total asset of the company at present stands at around Rs 25 billion. It has 5000 employees. According to Kansakar, the Nepal Telecom would also float its share to the public soon after it assesses its net asset. Expectations have been raised that efficiency and service-delivery of NTC will increase after this transformation.

Meanwhile, the company has changed its post-paid mobile numbers from April 13 in order to meet the growing demand. “As per the new arrangement the number length of post-paid mobile phones will be of 10 digits with changes in area code,” said Madan Kaji Shakya, director of New Services Directorate at NTC on Monday. According to him, the number ‘5’ as operator code will be inserted after access code of ‘98’. “The new numbering system has been planned to accommodate 10,00,000 customers each in Bagmati, Narayani and Gandaki, while 600,000 each in Koshi and Lumbini and 200,000 each in the rest of other zones,” said Shakya.

The NTC is also set to introduce international short messaging service (SMS) and outbound roaming system on post-paid cellular mobile phones beginning April 13. To avail of outbound roaming facility, customers need to deposit Rs 30,000.

Likewise, from April 13 onwards the NTC mobile users can send SMS to customers of 35 operators in 16 different countries. International access code and country code should be dialed before the mobile number while sending SMS. Each message of 160 characters will cost Rs 10. Receiving international SMS will be free.

Till date, a total of 135,331 people have purchased NTC mobile including 69,500 pre-paid and 65,831 post-paid users.