Thaindian News

Kathmandu, May 11 (IANS) The two-day trade talks between Tibet and its largest trade partner since 2001, Nepal, ended in Kathmandu Tuesday with both sides inking a memorandum of understanding to hold a trade fair in the Nepali capital from Nov 2-6, officials said.

The Nepal-China Tibet Trade Facilitation Committee, led by Tibet’s deputy secretary-general Ye Yinchuan and Toya Narayan Gyawali, joint secretary at Nepal’s commerce and supplies ministry, also agreed to iron out problems plaguing bilateral trade and creating a growing imbalance in China’s favour.

While Beijing exported goods worth Nepali Rs.43 billion to Kathmandu in the financial year 2009-2010, according to Nepal’s Trade and Export Promotion Council, Nepal’s exports amounted to only Rs.1 billion, causing a staggering trade deficit of Rs.42 billion.

The first eight months of 2010-11 has seen the worrying trend continue with imports from China rising by 0.8 percent but Nepal’s exports plummeting by 55 percent.

Nepal attributes the drop to stringent quarantine rules, the slapping of local taxes on the Tibet side, lack of infrastructure and the unrest in Tibet that made Beijing slap a ban on religious items like statutes that formed the bulk of Nepal’s exports.

Though in principle China has provided given duty-free access to over 4,700 items from 33 least developed countries, only 361 Nepali goods fall in that category and the trade in these items in not high.

Nepal also asked the Tibetan side to speed up the construction of a dry port in Tatopani region in northern Nepal, the main trade route to Tibet. Its other dry port in Birgunj in the south was built by India, Nepal’s largest trade partner.

The other infrastructure request is for speeding up the second highway between Nepal and Tibet, the 16 km road from Rasuwa in central Nepal to Kerung in Tibet’s Shigatse prefecture.

Nepal has also asked China to establish a bank branch in the Himalayan republic. From 2010, Nepal as a new member of the World Trade Organisation gave the go-ahead to foreign banks to open branches on the condition that they had a minimum capital of $30 million.

Earlier, foreign banks could open only joint-venture banks in Nepal.

(Sudeshna Sarkar can be contacted at sudeshna.s@ians.in)