Export revenues from listed products inch up 2.7 percentEarnings increase due to a rise in demand for medicinal herbs, woollen carpets, yarns and textiles.
Earnings from the export of products identified by the Nepal Trade Integration Strategy inched up 2.7 percent in the first 11 months of the current fiscal year, largely due to a rise in demand for medicinal herbs, woollen carpets, yarns and textiles.
According to the Trade and Export Promotion Centre, revenues from the export of nine Nepal Trade Integration Strategy products between mid-July and mid-June, reached Rs33.94 billion, up from Rs33.06 billion during the same period last year. The growth rate slowed compared to the previous year when export earnings increased by 10 percent.
Suyash Khanal, deputy executive director of the Trade and Export Promotion Centre, said the rise in exports was due to an improvement in the quality of the products and increased diversification of the market for items such as yarns and medicinal herbs.
Based on the country’s comparative advantage, the Nepal Trade Integration Strategy has identified nine goods—woollen carpet, cardamom, ginger, tea, medicinal herbs, hides and skins, footwear, pashmina and yarn and textile—as the main exportable items. Among them, export revenues from four items have swelled.
Earnings from medicinal and aromatic plants soared by 27.6 percent to Rs1.36 billion. Turmeric, Nepal pepper, asparagus, cinnamon and spikenard, among others, are the country’s main exportable herbs. Khanal said Nepali herbs were finding a better market in Europe than in India due to Indian non-tariff barriers. “Mostly fragrant herbs are in great demand in third countries to manufacture cosmetics,” said Khanal.
The value of yarn and textile shipments surged 13 percent to Rs14.87 billion. According to Khanal, exports of Nepali acrylic yarn increased after Bangladesh lifted a ban on the import of acrylic yarn from Nepal through the Banglabandha land port.
According to the Trade and Export Promotion Centre, yarn shipments accounted for 10 percent of the total export revenues during the review period. Half of the shipments went to Turkey. Bangladesh was the second largest importer of Nepali yarn. India, Hong Kong and a number of Southeast Asian countries including Vietnam are the other major importers of Nepali yarn.
Export earnings from woollen carpets increased 5.6 percent to Rs6.85 billion while earnings from pashmina rose 1.6 percent to Rs2.23 billion.
Among Nepal Trade Integration Strategy products, exports of leather goods plunged 40 percent while ginger also saw a steep drop of 38 percent. Shipments of footwear and cardamom also fell sharply by 27.9 percent and 13.2 percent respectively.
The government gives a cash incentive of 3-5 percent for the export of Nepal Trade Integration Strategy 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.
The government revised the list of Nepal Trade Integration Strategy products in 2016. It aims to bring up the export value of merchandise goods listed under the Nepal Trade Integration Strategy to 4 percent of the gross domestic product by 2020. The export value of some of the products added to the list such as leather goods and footwear has been dropping constantly.
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