Nepal’s earnings from exports of products identified by the Nepal Trade Integration Strategy (NTIS) rose 7 percent in the first five months of the current fiscal year, largely due to a rise in demand for medicinal herbs, woollen carpet, tea, yarn and textile products.

According to the Trade and Export Promotion Centre, the country earned Rs15.76 billion from exports of nine NTIS products between mid-July and mid-December, up from Rs14.73 billion during the same period last year. 

Commerce Secretary Chandra Kumar Ghimire said that the growth was due to an improvement in the quality of the products and easing of non-tariff barriers by a number of countries including India. “In addition, demand for Nepal’s organic tea has been growing in overseas markets, resulting in higher export revenues,” Ghimire said. 

The NTIS identified nine goods—woollen carpet, cardamom, ginger, tea, medicinal herbs, hides and skins, footwear, pashmina and yarn and textile—as having a comparative advantage. Among them, export revenues of six items have swelled. 

Export earnings from medicinal herbs doubled to Rs643.76 million while exports of woollen carpets rose 16.4 percent to Rs3.35 billion, and yarns posted a 12.3 percent growth to Rs6.39 billion. Export revenues from tea recorded an 11 percent growth. Nepal exported tea worth Rs1.93 billion during the review period. Ginger shipments rose 6.4 percent to Rs276.81 million and pashmina exports increased 4.3 percent to Rs1.27 billion. 

However, export earning of three items footwear, raw skins and cardamom recorded a double-digit drop. Footwear and raw skins are the newly-introduced products under the revised NTIS product lists two years ago. Export earnings from raw skins dropped 54.5 percent to Rs164.72 million.

The government gives a cash incentive of 3-5 percent for the export of NTIS products. Traders get a 5 percent cash incentive for exporting processed tea, large cardamom, ginger, leather goods and processed herbs and oil products with a value addition of at least 50 percent. Traders get a 3 percent cash incentive for exporting pashmina products under the Chyangra Pashmina brand, textiles, woollen carpets, and yarn made of polyester, viscose, acrylic and cotton.

Toya Narayan Gyawali, joint secretary of the Ministry of Industry, Commerce and Supplies, said the government had included these items in the cash incentive scheme after conducting a comprehensive study. “The list can be revised based on export performance in the future,” Gyawali said.