January / February 2001
FNCCI and Confederation of Danish Industries sign MoU to Boost Nepal-Denmark economic cooperation
The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and the Confederation of Danish Industries (CODI) signed a Memorandum of Understanding (MOU) for promotion of bilateral trade and investment between the two countries.
The memorandum was signed on behalf of FNCCI by its President Pradeep Kumar Shrestha during his recent visit to Damak.
In the MOU, both the parties have agreed to promote bilateral trade and investment transfer technology, increase bilateral cooperation in service and commercial areas, exchange information, organise trade fairs in both the countries from time to time and encourage participation in such fairs and exchange business delegations.
Similarly, they also agreed to extend necessary cooperation during the visit of the business community and technical teams to either country, provide suggestions relating to the measures to be taken for promotion of bilateral trade, organise training, workshop and seminars on the areas of cooperation agreed upon and carry out other activities for attaining the objectives of the MoU.
FNCCI president Shrestha had visited Denmark on the way back to Nepal after attending the meeting of the role of private sector in enhancing the capacity of IDCs held in Oslo, the capital of Norway from January 28-30
SAARC Chamber Meet ends in Kathmandu
The seventh general meeting and 20th executive committee meeting of the SAARC Chamber of Commerce and Industry concluded in Kathmandu on February 5, 2001.
As per the decision of the general meeting to amend the statute and make provisions for a senior vice-president, former president of the Federation of Nepalese Chambers of Commerce and Industry and its distinguished member Padma Jyoti was elected to the position.
The meeting concluded after taking the decision to convene the executive committee meeting and the next general meeting in Pakistan and Maldives respectively, take ahead the process of constituting a SAARC arbitration council and grant permission to the SAARC Tourism Council to host a SAARC Tourism Fair.
The programmes fixed by the executive committee for the forthcoming year are solidarity among the member countries to move ahead unitedly with regard to the World Trade Organisation (WTO), undertake various studies including that concerning infrastructure building for the development of transport sector, host the SAARC Economic Conference, take ahead the studies on cottage and small industries in member countries, and hold interaction programmes with high ranking officials of member countries to take ahead the partnership between the govermental and private sectors.
On the occasion, the Pakistani delegation informed of the hosting of the SAARC Trade Fair in Pakistan from April 21 to 26, 2001.
Delegates from Bangladesh, India, Maldives, Pakistan, Sri Lanka and Nepal attended the programme presided over by chamber president Qasim Ibrahim.
Likewise, SAARC Economic Cooperation Conference on "Government-Private Sector Partnership: A strategic Alliance for 2010 also concluded on 4th Feb. 2001. The conference was inaugurated by the Prime Minister Girija Prasad Koirala and the Conference was organised by Federation of Nepalese Chambers of Commerce & Industry (FNCCI) & SAARC Chamber of Commerce and Industry in cooperation with Friedrich Nauman Stiftung.
Nepal, India agree to exchange more electricity
The sixth Nepal-India power exchange committee meeting that concluded in Kathmandu recently agreed to exchange up to 150 megawatt of electricity between the two countries.
The existing provision allows the two countries to exchange up to 50 megawatt of electricity.
Nepal currently imports about 50 megawatt from India, while India receives about 37 megawatt from Nepal.
The Nepalese delegation to the meeting that began on Jan. 16 was led by executive director of Nepal Electricity Authority Bishnu Bam Malla and the Indian delegation by member of the Central Electricity Authority and ex-officio secretary of the Indian government K.N. Sinha.
Nepal, Pakistan sign accord on double taxation
His Majesty's Government and the government of Pakistan have signed an agreement to evade double taxation and check evasion of income tax.
According to the Ministry of Finance, the agreement aims at protecting investors of both countries from double taxation, and promoting investment.
The agreement, which is based on the international practices that define the taxing rights between Nepal and Pakistan in different circumstances, is expected to serve as a milestone in bilateral relations and fostering cooperation in such sectors as trade, finance, economy and culture.
The agreement was signed by secretary at the Finance Ministry Bimal Prasad Koirala and Riaz Hussain Naqvi, secretary at revenue division and chairman of central board of revenue on behalf of their respective governments.
His Majesty's Government has already signed into agreements with India and Sri Lanka to avoid double taxation.
Tourism promoted in Germany
The inauguration of CMT (Carayan Motor Tourism) international Tourism Fair (from 20-28 January) 2001 was held in a grand way on 20th January 2001 in Stuttgart, Germany. The Fair was organised by Stuttgart, Germany. The Fair is organised by Stuttgart Fair Authority (Messe Stuttgart) every year, since 1968 according to a press realease of Nepal German Chamber of Commerce and Industry (NGCCI) CMT International Tourism Fair, which is organised every year is one of the premier tourism fairs in Europe, CMT is the first major international tourism fair to be held in Western Europe at the beginning of each year and attracts more than one thousand travel related prominent cooperate bodies and tourism promotion boards from more than one hundred nations. Besides Germany, large number of visitors from Austria, France, Switzerland, Italy, Spain, Belgium, Netherlands visit the fair to select and arrange their next holiday destination.
After the opening session Prime Minister, Tourism Minister and Lord Mayor of Stuttgart visited the Nepal Stand. Around 2500 people visited the Nepal stand to inquire about the travel arrangements to Nepal. Mongolia situated in front of Nepal Stand is the partner country besides Italy and NewZealand this year for CMT International Tourism Fair 2001.
Export increased by 25%
The total overseas export of the nation has increased by nearly 25 percent during the first four months of the current fiscal year in comparison to the corresponding period during the previous year.
This is due largely to a whooping 372 percent rise in the export of the pulses from mid July to mid-Nov. 2000. The country exported 5,329 metric tons of pulses during the reported period worth Rs. 196 million Besides, the export of pashmina shawls to the overseas countries rose by 170 percent. The total export value of the pashmina shawls during the first four months of the current fiscal year amounted to Rs. 2.18 billion, up from Rs. 753 million during the corresponding period of the earlier year. The readymade garments, handicrafts, tea, raw lather and silver jewelers were other items that contributed to trade expansion, according to Trade Promotion Center (TPC) sources.
The export of carpet-second only to the ready made garments however fell by 13 percent during this period compared to the corresponding period previous year. The export of carpet totalled 776 thousand sq. metres with a value of Rs. 3.2 billion.
Meanwhile, TPC's annual publication "Nepal Overseas Trade Statistic" showed that the value of the country's overseas trade stood at Rs. 166 billion during 1999/2000. The total export value stood at Rs. 51 billion (30.7 percent) while the total import amounted to Rs. 115 billion (69.3 percent).
The publication showed that the country's export to India was increasing substantially during the recent years constituting 44.4 percent of the total export during 1999/2000. Nepal's export to the overseas and India constituted 54.6 percent and 1.0 percent respectively. The export to the overseas stood at Rs. 27.8 billion while the value of export to India and Tibet amounted to Rs. 22.6 billion and 500 million respectively.
The readymade garments, woolen carpets, pashmina shawls, handicrafts, silver jewelers, leather, niger-seed, and pulses were the major items exported. The export value of readymade garments and woolen carpets amounted to Rs. 11.1 billion and 10.4 billion Rs.
The imports from India during 1999/2000 amounted to Rs. 40.9 billion (35.6 percent), while the overseas import stood at Rs. 69.8 billion (60.8 percent). The import from Tibet amounted to Rs. 4.2 billion (3.6 percent).
The statistics showed that the trade deficit was widening with an increasing gap between import and export. The total trade deficit of the country touched Rs. 64 billion during 1999/2000. The deficit in Nepal-India front was Rs. 18 billion while the deficit in overseas and Nepal-Tibet front was Rs. 42 and four billion respectively.
The price of Urea hiked by 35%
Agriculture Input corporation (AIC) has hiked the price of urea by 35 percent, pushing up the price of urea to Rs. 1400 per quintal. The latest price hike was made for Birgunj, Nepalgunj, Dhangadi and Biratnagar. Prices in other areas would include extra transpiration costs.
General Manager of AIC, Nitya Raj Koirala, said that urea price was hiked because the recently imported 12,500 tons of urea from China was expensive. However, the price of DAP (diammonium phosphate) remained unchanged since its procurement price had not increased.
Prior to the latest price hike, AIC on November 13,2000 had raised urea price by 16 percent pushing up the prices to Rs. 1040 per quintal. At the same time, the corporation had reduced the price of DAP from Rs. 2040 to Rs. 1950 per quintal.
The latest price hike has caused the price of urea to touch almost 100 percent higher than the price three years ago, Price Urea three years ago, at the government subsidised rate was Rs. 740 per quintal only.
The Nepal government had opted for slashing subsidy in fertilisers in 1997 as per its agreement with Asian Development Bank (ADB) for the release of the Second Program Loan under Agriculture Perspective Plan. The subsidy was finally brought to zero in December, 1999.
ADB has pressed for the revocation of the subsidy with the belief that removal of subsidy would encourage private sector participation in the supply of fertilisers, which in turn would induce farmers to use more urea through adequate supply and equitable distribution.
ILFC sign an MOU on equity participation
International Leasing and Finance Company (ILFC) Ltd. A joint venture with KDB. Capital Corporation in Korea and the International Finance corporation (IFC), a subsidiary of the World Bank Group, signed an MoU (memorandum of understanding) on equity participation recently.
Siddheswar Kumar Singh, Chairman of ILFC and Bernard Pasquier, Director of IFC signed the document to this effect on 24 January 2001 amid a function. IFC's equity participation in ILFC is the first of its kind in Nepal's financial sector, which is expected to upgrade the general condition of Nepalese financial market through international standard management and service.
IFC will make an equity investment of about $ 300,000 (Rs. 22.3 million), which is almost 25 percent of ILFC's share capital. The remaining shares will be held by ILFC's Nepalese promoters led by the National Life and General Insurance company and Korean Joint Venture partner, KDB Capital Corporation.