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Experts divided on Nepal’s benefit from SAFTA
KATHMANDU, JAN 22 - Experts and businessmen have expressed mixed reactions to the benefits that Nepal could accrue from the implementation of South Asian Free Trade Area (SAFTA), which comes into partial effect from 2006.
Speaking at a discussion programme on ‘SAFTA: Implications for Nepal’ organised by the ‘boss’ magazine here today, Suraj Vaidya, Third Vice-President of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) said that Nepal could benefit nothing from SAFTA in the long run.
"Nepal will lose from SAFTA. Instead of making effort to join SAFTA, we should focus on improving the trade relations with India," he said.
Padma Jyoti, President of SAARC Chamber of Commerce and Industry, expressed the views that ultimately there would be no difference whether you join SAFTA or not, but it would be better to have a regional trading bloc.
"Almost all the members of the World Trade Organisation (WTO) have their regional trading blocs. So it would not be unusual for us to have one. SAFTA can be used as a forum for regional trade," Jyoti said.
Dr Bishwombhar Pyakuryal, a noted economist and President of Nepal Economic Association, suggested that economic diplomacy in future should be pursued carefully in order to benefit from either regional or global trading arrangement.
"We need to look into benefit and costs in order to make our products competitive in both regional and global trading," he added.
Purushottam Ojha, Joint Secretary at the Ministry of Industry, Commerce and Supplies, said that enough consultation with the private sector, especially during the latter half, could not be made.
Since Nepal has already low customs duty rates, she would not lose revenue significantly following the implementation of SAFTA.
He also said that joining the regional trading bloc could benefit Nepal. Rules of origin, sensitive list of goods, revenue compensation and trade, the crucial issues of the regional trading bloc, are yet to be discussed and negotiated.
TK Gupta, Vice-President of Nepal India Chamber of Commerce and Industry, said that Nepal could benefit from joining SAFTA.
Since 20 per cent of the world population lives in the SAARC region, the implementation of SAFTA, which increases the movement of people in the region, would definitely help boosting Nepal’s tourism industry, Gupta said.
He said that Nepal has some comparative advantages due to its climatic and geographic structure over other countries.Posted on: 2004-01-23 03:23
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