• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

THE RECENT VISIT of King Gyanendra of Nepal has provided New Delhi an opportunity to take a number of steps which will endear India to the Nepalese, especially as this was the first royal visit to this country after the cataclysmic events in Kathmandu a year ago. WithMaoists on the rampage, Nepal needs assistance, both against terrorists and for its economic development, and it would be shortsighted of New Delhi not to make at least some concessions which could pay handsome political dividends later.

It is a welcome development that New Delhi has not let the grass grow under its feet after the renewal of the India Nepal Trade Treaty earlier in the year. Responding to protests from Nepalese trade and industry to specific aspects of the new treaty, it has agreed to review the anti-dumping and special additional duties it had imposed on four important Nepalese exports — acrylic yarn, zinc oxide, vanaspati ghee and copper wire. Of course, New Delhi cannot take drastic steps in this direction because of the impact on Indian interests dealing in the four items. But some sacrifices will have to be made on political and diplomatic grounds, especially now when poverty-stricken Nepal is under terrorist attack too. Apart from lifting import and other duties on these Nepalese items, there are in other areas also good scope for India-Nepal collaboration. For instance, Kathmandu's requests to New Delhi to lift restrictions on Nepalese wheat exports, to take up the issue of imposition of taxes on Nepalese products by some State governments, and to remove certain non-trade barriers allegedly erected against Nepalese farm and forestry products. On its part, Nepal, an established conduit for cheap third country products coming into India, must do its best to prevent such trade practices which, while not helping in any way the Nepalese manufacturing sector, undermines Indian industrialists producing the items concerned.

The India-Nepal two-way annual trade has increased five-fold between 1996-97 and 2001-2002 (to more than Rs 5,000 crore), and needs all the official assistance possible to continue uninterrupted (India's principal exports are transport equipment, drugs, phamaceuticals and fine chemcials). King Gyanendra's visit has shown that not only is there the potential but that there is welcome interest among the authorities of both the countries to step up implementation. Apart from the official interest, that shown by CII and FICCI for greater trade exchange is to be appreciated. Already, as a result of the royal visit, Nepalese and Indian businessmen have reportedly agreed to work on a "business to business" basis, to make the best use of the renewed trade treaty and to use more effectively Nepal's immense, untapped hydro-power potential. Both sides will have to make concessions to strengthen the trade ties, New Delhi a bit more as behoves the big brother.

Send this article to Friends by E-Mail

Stories in this Section
A Himalayan opportunity

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line