By Our Reporter
Nepal has failed to diversify its international trade as well as lessen the trade deficit with its major trade partners like India, Germany, China and Bangladesh.
This was revealed in the statistics of the Trade and Export Promotion Centre (TEPC). However, Nepal’s trade with the US has not witnessed such deficit.
A couple of years ago, had formulated the Nepal Trade Integration Strategy, which identified the goods with export potential and implemented promotion campaigns of ‘Made in Nepal’ goods in the international market, and put its efforts to diversify the international trade, following the border blockade in 2015/16, but the results are not encouraging.
The trade deficit with the largest trade partner, India, has gone up to Rs. 586.24 billion with imports of Rs. 628.85 billion and exports of just Rs. 42.61 billion.
The trade imbalance with China also increased in 2015, despite the earthquake that destroyed the highway to Khasa on the Nepal-China border point, and created huge constraints in the trade between the two countries.
The trade deficit with China volleyed up to Rs. 132.06 billion in 2016 from Rs. 89.76 billion in 2014 and Rs. 92.06 in 2015. In the past three years, Nepal’s export to the northern neighbour dropped to Rs. 1.94 billion from Rs. 3.09 billion.
Nepal has been in trade surplus with the USA since 2011, but in 2016, the former witnessed a deficit of Rs. 750 million.
Likewise, trade deficit with Germany and Bangladesh is also widening gradually.
Political instability, high production cost, labour shortage and high cost of trade are blamed for Nepal’s weakening international trade.
Experts said that the country needs to focus on certain products that have comparative as well as competitive advantage in the international market.
Nepal’s top import sources in 2016 were India, China, United Arab Emirates, Indonesia, Thailand, USA, Japan, Argentina, Malaysia and Vietnam.
Likewise, India, USA, Germany, Turkey, United Kingdom, China, Bangladesh, France, Japan and Italy were the top export destinations.