Indo-Nepal trade treaty to be recast
Financial Express (India) 17 April 2006
Indo-Nepal trade treaty to be recast
Subhash Narayan
New Delhi, April 16 — The government plans to broadbase the scope of the bilateral Indo-Nepal treaty for trade to make it less import-centric and more comprehensive and mutually beneficial. The treaty is up for review next year.
The present treaty with its focus on imports from Nepal and duty exemption on a host of imports from the Himalayan kingdom has already impacted the Indian vanaspati industry adversely. A porous border has added to the problems.
According to industry sources, the commerce ministry in consultation with industry is planning to include more items for trade under the treaty including service sector areas like IT, ITeS and BPO where Indian knowhow is globally acceptable.
Also on the agenda is a proposal to give a thrust to trade in pharmaceuticals where duties could be brought down to facilitate both Indian exports as well as imports from Nepal. By doing this, the government hopes to reduce distortions in the pact (which was last amended in March 2002) and is up for review, if required, in March 2007.
Sources, however, said rather than proposing largescale changes to the treaty, the government may seek to broadbase it by expanding the overall trade basket. It may also look at ways to control illicit trade through the porous Indo-Nepal border.
