Nepal, India to open re-exports, trade via air

Kathmandu: Nepal and India have agreed to open up re-export of third country goods through formal agencies based in each other’s territory, eliminating a decades-long ban on such trade.
The agreement to this effect was reached during the two-day bilateral trade talks which concluded in the capital Friday. The two sides also inked a memorandum of understanding (MoU) on a host of decisions taken for facilitating bilateral trade.
“Allowing re-export of third country goods is a major shift in policy, and it has been agreed upon with a view to discouraging transshipment by formalizing the re-exports,” said Surya Silwal, joint secretary at the Ministry of Commerce and Supplies, who signed the MoU on behalf of Nepal.
Hitherto, the Nepal-India trade treaty restricted re-exporting of third country goods to each other’s markets. Even as Nepal has directed its traders to respect this provision of the treaty, India was mainly accused Nepal of flouting it.
The amendment of this provision is expected to facilitate bilateral trade in the context of the changed global trading arrangements and also bring the transshipment of goods within the purview of law and monitoring.
Silwal, who led the Nepali technical team at the talks, told myrepublica.com that the two countries have also decided to open bilateral trade through air transport. So far, the treaty had been silent on conducting trade via air route and recognized trade over land routes only.
“For the purpose of this, Tribhuvan International Airport in Kathmandu is slated as the official air transit point for trade to India. Likewise, India has designated airports in Kolkata, Mumbai, Delhi and Chennai as transit airports for conducting bilateral as well as third country trade for Nepal,” he said.
During the meeting, India also agreed to incorporate in the bilateral trade treaty a clear provision on exempting excise, additional customs and other duties and charges on Nepali exports to India.
06/03/09 Milan Mani Sharma/Republica, Nepal

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Categories: Foreign Mar 2009