The government is formulating an Internal Trade Policy (ITP) to better
manage and develop local markets and boost local trading activities.
The larger interest of the policy is to better serve the interest of
consumers, said an official at Department of Commerce and Supply
Management (DoCSM).
“Its goal is to facilitate the establishment and
development of value chain, raise employment and income opportunities
through expansion of commerce and ultimately attain poverty reduction,”
Narayan Prasad Bidari, director general of the DoCSM told Republica.
The department has outsourced the task of preparing the ITP to South
Asia Watch on Trade, Economics and Environment (SAWTEE), a
Katmandu-based regional think tank.
If the government came up with the policy, it will be the first of its
kind on internal trade. So far, the government has policy on foreign
trade only. Supply policy too was formulated only recently.
“We expect SAWTEE to submit the draft within a week,” said Bidari,
adding that the department will widely circulate it and incorporate all
the feedbacks before finalizing it.
SAWTEE officials drafting the policy said the ITP will aim to promote
domestic trade by enhancing the backward and forward linkage that
directly support the farmers to get returns from their productions in
the longer term.
Dr Ratnakar Adhikari, general secretary of SAWTEE said the formulation
of ITP was important as the government has so far been given less
attention towards increasing the size of domestic trade.
"We must have a substantial size of domestic trade even while giving
special emphasis on promoting exports. Only this balanced approach will
help us develop a sustainable economy," said Adhikari.
In fact, its (ITP´s) importance has grown in the wake of global economic
slowdown. After slowdown affecting exports, countries such as China
have proven that it can continue to give momentum to economic growth by
focusing on internal trade. "The strong size of the domestic trade
boosts the confidence of the country even in times of global crisis,"
said Adhikari.
Officials said the ITP will broadly be an integrated framework to
promote the domestic productions and increase manufacturing sector´s
contribution in the economy.
Fundamentally, it will encourage productions for domestic consumptions,
create new job opportunities and anticipates this rise in income in turn
will boost consumption and help develop markets in all regions of the
country.
“The new policy will also focus on smoothening food distribution,
improve supplies and facilitate the development of wholesale and retail
markets of essential goods by improving connectivity, among others,”
said Bidari.
The group of experts (GoE) meeting on South Asia Trade in Services
(SATIS) has ended without any breakthrough as participating countries
refrained from making clear commitments on services that will open for regional trade.
Officials from the eight member countries of South Asia Association for
Regional Cooperation (SAARC) who met in Kathmandu couldn´t make any
commitment from their respective countries regarding liberalization of
services that is aimed at boosting regional trade.
“Apart from Bhutan and India, it seemed that other countries attended
the meeting without doing any exercise at home to make their commitment
to facilitate regional trade liberalization,” said an official attending
the meeting.
The two-day meeting, which concluded in Kathmandu on Wednesday, was
supposed to garner commitments from all eight member countries to boost
regional service trade under the South Asia Free Trade Agreement (SAFTA)
pact.
“The meeting ended with a decision to meet in Kathmandu again in
September with the hope to garner concrete commitments from member
countries,” the official told Republica.
The SAFTA ministerial council meeting held in Dhaka in April 2006 had
assigned to a panel of experts to furnish a report on viability of
incorporating the service sector into the regional trade framework.
“Member countries have already liberalized their service sector to a
certain extent under the General Agreement on Trade in Services in the
World Trade Organization (WTO). Further commitments are forthcoming
under the regional framework,” reads a study report published by CUTS
International, an India-based organization working in the sector of
consumer unity and trust.
According to the official, the meeting also decided to submit proposals
and requests to SAARC Secretariat for further liberalization in service
trade by August. “The proposed meeting in September will discuss on the
proposals and requests made by member countries,” the official added.
SAARC members had agreed to enhance regional trade under free trade
agreement in 2004 before enforcing the SAFTA regime in 2006 with the
main objective of creating jobs and reducing poverty through trade
integration and liberalization of service sector for investment.
A crucial meeting of Working
Group of eight South Asian countries, which was supposed to slash the
existing long list of sensitive items - on which they have refused to
trade at zero tariffs, ended Tuesday without any headway.
The meeting ended inconclusively after the members of South Asian
Association for Regional Cooperation (SAARC) remained divided over the
modality for downsizing the list.
“India, Pakistan, Bhutan and the Maldives wanted all the members to
downsize the items in sensitive list to just 100 products. We could not
agree to it,” one of the officials, who participated in the meeting,
told Republica.
Contrary to their proposal, officials from other SAARC countries,
including Bangladesh, Afghanistan and Sri Lanka, proposed that the list
be gradually reduced by 30 percent over the span of next 5 years. Nepal
that opposed the former modality, however, maintained its silence on the
latter proposal as well.
“We did not express commitment of any sort because we are still to
implement the previous commitments on tariff liberalization,” said the
source.
The eight-member bloc of SAARC had agreed to trade under free trade
agreement in 2004, and enforced the SAFTA regime in 2006, eying to
create jobs and reduce poverty through trade integration.
However, the intra-regional trade has not yet made significant headway
largely due to the long sensitive list. Presently, the sensitive list
has as much as 20 percent of total regional tradable items. Worse is
that each member countries have largely included items of others exports
interest in the list.
Realizing this constraint, the SAARC leaders during the last Summit
asked the Working Group to further downsize the items in the sensitive
list so that the members in the region could trade more freely and
meaningfully. The meeting in Kathmandu was held as a part of this
negotiation.
“Around 3 to 4 modalities for further reduction of sensitive list were
tabled during the meeting. But nothing concrete could be decided,” said
Naindra Prasad Upadhaya, joint secretary at the Ministry of Commerce and
Supply (MoCS).
Given the difference and failure to come up with any concrete plan for
further reduction of sensitive list, the Working Group on Reduction of
Sensitive List (WGRSL) ended the meeting, deciding to meet again in
September.
Officials said all the SAARC members have expressed commitments to
further open up their markets. “Hopefully, we will reach to some
conclusion when we discuss on the new proposals in the next meeting,”
said the official.
As for the separate meeting on South Asia Trade in Services (SATIS),
which began on Tuesday, officials said member countries are still
negotiating and proposing sectors that they will open for service trade.
“Negotiations are still on in very basic issues,” Upadhaya made a very short comment.
Private sector of Nepal and Pakistan have stressed the need to increase
connectivity between the two countries in order to increase bilateral trade.
According to a press release issued on Tuesday, trade representatives
from Rawalpindi Chamber of Commerce and Industry on the day held
discussion on trade and connectivity with officials of Federation of
Nepalese Chambers of Commerce and Industry.
Nepal Trade Integration Strategy (NTIS) 2010 - a blueprint of the
government to boost export - has identified Pakistan as a destination
country for four goods - cardamom, ginger, lentils and tea.
“Officials of the two trade organizations underlined the need to
decrease airfare between Nepal and Pakistan. They also held discussions
on the ´3rd Made in Pakistan Fair´ being held in Kathmandu from June 20
to 26.
Pashupati Murarka, vice-president of the FNCCI and Ajar Man Shrestha,
president of Lalitpur Chamber of Commerce and Industry (LCCI) were also
present in the meeting.
According to statistics of Trade and Export Promotion Centre (TEPC),
Nepal suffered trade deficit of Rs 20.2 million with Pakistan in fiscal
year 2009/10. Nepal mainly exports cardamom, ginger, lentils and tea to
Pakistan.
The government has kicked off preparation to arrange land acquisition
for construction of a 8-lanes ring road from Kalanki to Koteshwore to be
developed with assistance of Chinese government, after the completion
of preliminary design of the project.
According to a high level official at the Ministry of Physical Planning
Works and Transport Management (MoPPWTM), the Chinese company carrying
out the survey and design of the project submitted the construction
design to the ministry.
“We are studying the design that was prepared by The Third Railway
Survey and Design Institute Group Corporation (TTRSDIGC),” Ramesh Raj
Bishta, joint secretary at the MoPPWTM said, “We might have some comment
on the design but if we don´t we will okay it.” He further added that
the contract for detail project report (DPR) and construction would
start after finalizing the design.
The government and China had signed the letter of exchange (LoE) for the
project in Feb 2011. “The project will be completed within three years
of its commencement,” Bista said, “The cost of construction is yet to be
estimated. However, the rough estimation is Rs 5 billion.”
According to Bista, the government has to arrange the land for the
construction of road. “It requires 62 meters of width for the
construction of 8-lane road,” he said, “There is sufficient open land
for the construction of road.” The government has anticipated that the
construction will begin at the end of this year or from the beginning of
2013.
The government should have a matching fund for the project. “However,
it´s not been finalized how much matching fund the government will
arrange for this project,” Bista told Republica on Sunday.
The design that the TTRSDIGC has submitted outlines the map of road from
Kalanki to Koteshwore, which geos through Ekantakuna, Satdobato and
Guwarko. “There will be different lanes for motorized vehicles and
non-motorized vehicles,” Bista said.
According to an official at the MoPPWTM, the construction of the road
also will be awarded to the Chinese companies. “We will just have to
coordinate with them,” the official told Republica.
