Indigenous investment must to promote country export

KATHMANDU, MAR 2:

Experts during a programme have urged the government to expedite indigenous investment to promote exports and set up industries to substitute imports.

Speaking at a workshop organised by Nepal Economic Association in coordination with Garment Association-Nepal (GAN), chairman of Mega Bank Nepal Prof Dr Madan Kumar Dahal focused on the binding constraints on the economy and the road towards development.

According to Dahal, indigenous investment must be expedited not only to promote exports but also to establish industries to substitute imports on the initiative of the private sector.

“The Acts, regulations, and policies should be modulated especially with reference to agriculture policy, industrial and investment policy, tourism policy and Income Tax Act and must be compatible with globalisation and liberalisation,” he said.

Dahal also said that there is a need to expedite trade and investment, especially with reference to Foreign Direct Investment and promote cooperation with India and China, regional bodies (SAFTA, BIMSTEC), WTO and global economies.

According to experts, there is a need to devise and endorse a model for export-led and private sector-led open and competitive economy to maximise the benefits of globalisation and liberalisation with due consideration to social justice and security.

Dahal mentioned that the long-term perspectives are penetrating bilateral, regional, and international markets with exports that have comparative advantage and a competitive edge, especially carpets, garments, handicrafts, pashmina and lentils.

Meanwhile, senior economist and secretary general of NEA Dr Chiranjibi Nepal highlighted the growing trade deficit. According to him, industrial growth has been slow and the country has become dependent on remittance.

Remittance growth has been robust and is as high as 23 per cent of the gross domestic product (GDP), and has been instrumental in reducing poverty to some extent over the years, said experts. “Trade deficit is increasing gradually. There are very limited exportable products and imports are huge,” said Nepal.

Merchandise exports grew at a slow pace to Rs 74.26 billion and imports rapidly increased to Rs 461.67 billion resulting in a huge trade deficit of Rs 387.41 billion, which is in excess of the size of the annual budget, states Nepal Rastra Bank data 2012.

Nepal’s share in total trade with India went up to 65 per cent while with other nations it levelled at 35 per cent. Exports constitute 14 per cent and imports comprised of 86 per cent in total trade.

Source: THT