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Relief needed from Indian countervailing and other para duties

BY DR. SUMAN KUMAR REGMI
Nepalese entrepreneurs have been requesting for removal of countervailing duty imposed by the Government of India (GoI) on the import of Nepali goods. Even as Nepali exporters have been lobbying for the same from time to time respectively through the Nepalese Government. But the GoI has not suspended the provision yet, perhaps never.
GoI used to impose the duty to safeguard concerned industries in India because the level of tariff imposed on import, which is also known as countervailing duty, will minimize the chances of imported goods being sold at cheaper rates as compared to the locally produced goods.
Normally countervailing duty is imposed on products that receive subsidy during manufacturing in the country of origin. GoI has imposed continuously such duty on readymade garment products to make up for excise duty levied on their own products. As per traders, India has imposed additional countervailing duty on Nepali garments, although Nepal’s export volume to India, especially of garments, is quite low, it could not affect the production base in India.
The safeguard measure taken by GoI has been severely hurting Nepal’s export to India. Nepalese entrepreneurs and exporters are arguing to suspend such duties to promote Nepal-India trade.
Three years back GoI was planned to impose antidumping tariff on jute products and asked the exporters to present reasons as to why the Indian Government should not impose this law on jute products within three months. Later, such duty was imposed for certain period.
Traders are also sought facility for movement of bulk cargoes to the railheads of Jogbani (Biratnagar) and Nautanwa (Bhairawa). Bulk cargoes ferried via rail only arrives in Inland Clearance Depot (ICD) at Birgunj – still the only rail-linked ICD of the country. As per the traders, if GoI allows movement of bulk cargoes to the railroads of Nepal border, it will help in reducing industrial products’ costs and shorten the delivery of goods because there is rapid industrialization in Bhairawa including other areas of the western region. The country imports heavy items, among others, as bulk cargoes.
The traders have also demanded the facility to import petroleum products via rail and has asked for Indian Government’s consent in establishing internationally accredited labs in the country.
Nepali traders have been approaching to India to accept the lab certificates issued by Nepal’s labs to export goods to India as Nepali traders are facing lots of problems related with quarantine while exporting agricultural and food items to the southern neighbour.
It has been made cleared from the India side time and again to forward the grievances of the Nepali traders to higher authority and concerned authority of India. Indian officials have been clarifying that the quarantine and other problems will be solved to a large extent after establishment of ICPs. But these ICPs have taken long time to be finished. When will they become ready operation, nobody knows. Even though, the Indian Government has been extending its warm and cooperative support to Nepal for trade facilitation.
(Dr. Regmi is former deputy executive director of the Trade and Export Promotion Centre.)

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