After nine-day deadlock, when imports of excisable goods from India came
to a grinding halt, some of the Indian traders have started exporting
goods to Nepal against Indian Currency (IC).
Two Nepali importers, including United Spirits, finally received their respective consignments, one from Bhairawaha and another from Biratnagar customs, on Friday, said Pashupati Murarka, vice-president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI).
However, he said the Indian exporters dispatched consignments only after the importers pledged collateral (of additional payment). “They have promised to refund the collateral as soon as the confusion is cleared,” said Murarka.
FNCCI officials said they have no clue as to what led the two companies to supply goods against IC payment. “But we hope other exporters will resume normal exports against IC soon,” said Murarka, adding that most of the factories, which depend on imported raw materials from India are on the verge of closure due to shortage of necessary materials.
The import of excisable items have come to a halt particularly after Indian exporters laid new condition of payment since March 1, when duty-refund procedure (DRP) was scrapped.
Scrapping of DRP paved the way for Nepali traders to receive goods at ex-factory rate (devoid of excise duty) and government to collect excise duty at customs points, but Indian exporters said Nepali importers should make payment in US Dollar if they are to get supply on ex-factory rates.
“If paid in IC, our (Indian) government considers the supply as local sales, and seeks us to pay excise,” they had argued.
Importers could not oblige though as Nepal Rastra Bank has opened USD payment facility for about 250 items only. If they accepted exporters´ condition (while paying in IC), they were required to pay excise twice -- in India as well as in Nepal.
The confusion, meanwhile, has brought imports of industrial raw materials and other goods on which excise duty is applicable like cement, clinker, textiles and vehicles, among others, to a grinding halt.
Talking to Republica, he disclosed that a delegation of FNCCI had recently approached the Indian Embassy in Kathmandu to settle their problem. “The Indian officials conveyed us that India has neither changed payment terms nor should we deal in USD,” said Murarka.
An official of the Embassy said, Indian Ambassador to Nepal Jayant Prasad too has communicated to the Indian Ministry of Finance conveying concerns of Nepali importers. But he did not disclose how the ministry responded.
Ministry of Commerce and Supplies (MoCS) on Wednesday formally approached his Indian counterpart to clarify why Indian exporters have not been trading against IC. However, the Indian ministry is yet to respond.
Two Nepali importers, including United Spirits, finally received their respective consignments, one from Bhairawaha and another from Biratnagar customs, on Friday, said Pashupati Murarka, vice-president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI).
However, he said the Indian exporters dispatched consignments only after the importers pledged collateral (of additional payment). “They have promised to refund the collateral as soon as the confusion is cleared,” said Murarka.
FNCCI officials said they have no clue as to what led the two companies to supply goods against IC payment. “But we hope other exporters will resume normal exports against IC soon,” said Murarka, adding that most of the factories, which depend on imported raw materials from India are on the verge of closure due to shortage of necessary materials.
The import of excisable items have come to a halt particularly after Indian exporters laid new condition of payment since March 1, when duty-refund procedure (DRP) was scrapped.
Scrapping of DRP paved the way for Nepali traders to receive goods at ex-factory rate (devoid of excise duty) and government to collect excise duty at customs points, but Indian exporters said Nepali importers should make payment in US Dollar if they are to get supply on ex-factory rates.
“If paid in IC, our (Indian) government considers the supply as local sales, and seeks us to pay excise,” they had argued.
Importers could not oblige though as Nepal Rastra Bank has opened USD payment facility for about 250 items only. If they accepted exporters´ condition (while paying in IC), they were required to pay excise twice -- in India as well as in Nepal.
The confusion, meanwhile, has brought imports of industrial raw materials and other goods on which excise duty is applicable like cement, clinker, textiles and vehicles, among others, to a grinding halt.
Talking to Republica, he disclosed that a delegation of FNCCI had recently approached the Indian Embassy in Kathmandu to settle their problem. “The Indian officials conveyed us that India has neither changed payment terms nor should we deal in USD,” said Murarka.
An official of the Embassy said, Indian Ambassador to Nepal Jayant Prasad too has communicated to the Indian Ministry of Finance conveying concerns of Nepali importers. But he did not disclose how the ministry responded.
Ministry of Commerce and Supplies (MoCS) on Wednesday formally approached his Indian counterpart to clarify why Indian exporters have not been trading against IC. However, the Indian ministry is yet to respond.
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