Trade talks with Bhutan next week

KATHMANDU, May 18: Nepal and Bhutan are holding joint-secretary level trade talks on May 24-25 in Thimpu, aiming to promote bilateral trade and share experiences and best practices in hydropower and tourism sectors.

“We are exploring the possibility of expanding our exports to the South Asian neighbor,” said Toya Narayan Gyawali, joint secretary at the Ministry of Commerce and Supplies (MoCS), who will lead Nepali in the talks.


The ministry is presently consulting with traders and exporters to give the final touch to its trade agenda. Nepal presently enjoys comfortable trade surplus with Bhutan.
Apart from trade, the Nepali officials will also seek to learn from Bhutan´s experience in attracting foreign investments in hydropower and tourism sectors. Nepal at the moment is suffering from severe energy crisis, which has affected economic activities at a time when the nation is celebrating Nepal Tourism Year 2011.

The two South Asian neighbors have no formal bilateral trade agreement. However, both the countries are signatories to the South Asian Free Trade Area (SAFTA) -- a regional trade agreement that aims for intra-regional trade growth through easy mobility of goods among member countries.

Bhutan has emerged as a potential export destinations for Nepal. Nepal enjoyed all time high trade surplus of Rs 1.42 billion with Bhutan in 2009/10. According to MoCS, Nepal exported goods worth Rs 1.55 billion to Bhutan during the period. Its import stood at Rs 133 million.

Nepal´s exports to Bhutan in 2008/09 stood at just Rs 194 million, whereas import from the Druk kingdom was recorded at Rs 352 million. Exports to Bhutan made up around 3.5 percent of the country´s total exports to SAARC countries in 2009/10. Nepal´s total exports to SAARC countries during the fiscal year stood at Rs 45 billion.

Nepal has been exporting industrial products, such as electricity transformers, noodles and handicrafts to Bhutan and importing fruits, tomatoes and other agro-based products from there.

Experts say Nepal should utilize the trade talks to learn from Bhutanese experience in hydropower and tourism sectors. “Bhutan has made tremendous progress especially in the hydropower sector, which has become a key to the growth in export-based industry there. We can hold talks with Bhutan for exporting electricity to the power-starved Bangladesh,” said Gyanedra Lal Pradhan, hydropower expert.

Surendra Bir Malakar, immediate past president of Nepal Chamber of Commerce, also said Nepal should explore the possibility of exporting agriculture goods, handicraft and other products to Bhutan.