REVISITING

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• REVISITING
• NEPAL-INDIA TRADE TREATY
• PRESENTATION BY J.P. AGRAWAL
• Date 14.01.2009

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1. OBJECTIVES OF THE TREATY NEED REDIFINING

• Mutually beneficial.
• Comprehensive open to include trade, investment
  and service sectors.
• Enabling umbrella treaty for any commercial
  issues.
• Facilitating transit for intra-country trade
  promotion.
• Prevention of unauthorized trade and any other
  economic offences across the border from both the
  sides.
• Avoidance of double taxation.
• Sectoral agreement under the umbrella treaty.
• Reducing transaction costs and time in doing
  business between the two countries

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2. STRUCTURE OF THE TREATY

• Perennial.
• Enforceable in any court of law in India and
  Nepal.
• Predictable. Discretionary powers avoided /
  balanced.
• Integrated approach to trade, investment,
  services, transit and diversification.
• Reciprocal but not apple to apple. Flexibility to
  give concessions as per the development status
  and ability.
• Emphasis on
• Macro economic stability.
• Good investment climate.
• Transparent procedure
• Adequate infrastructure
• Integrated approach

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3. Nepal-India Trade Development Board.

• Promoting Agency.
• Dispute settlement.
• Address Economic offences.
• Interpretation / adjudication.
• Achieve targeted volume of trade and investment
  within a given time frame.
• Procedural simplification, consolidation and
  publication.

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4. National treatment to Nepali manufactured
goods for access to Indian market.

• Green channel for goods manufactured out of 90
  Nepali and / or total Indian material and the
  agro-products.
• Concession are given as per the adjoining Indian
  state in addition to exemption of Indian custom
  duties.
• Non-tariff barriers not applicable on National
  treatment goods.
• Pre-shipment inspection by recognized certifying
  bodies enough for access to Indian Market.
• Registration of trading house for green channel
  concession.
• Criterion for National treatment.
• Goods Produced out of 90 Nepali and or Indian
  Material.
• Nepali Agro-product.
• Nepali primary product.
• Goods produced in Nepal-India Joint venture.

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• 6. Emphasis on transformation and manufacturing
  activities for rule of origin rather on value
  addition for access to India market.
• 7. Abolition of Duty refund procedure system.
  Allow Indian goods to Nepali market without
  payment of excise duty irrespective of the
  currency of payment.
• 8. Transportation is the major bottleneck adding
  to costs and competitiveness. It is a business
  opportunity which treaty should facilitate.
• 9. Surge and injury to domestic products,
  anti-dumping duty, safety measures are grey areas
  which are taken recourse to by vested interest
  groups. These need transparency.

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10. New areas for Joint Investment.

• a.
• Contract farming
• Contract manufacturing
• Establishment and management of SEZ
• Entertainment industry.
• Intra-city transportation.
• Infrastructure building.
• Urban development.
• Telecommunication.
• Bio-fuel production.
• Alternative energy.
• Health and education.
• b. Facilitate joint investment and efforts not
  only for each others market but for 3rd country
  export.

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11. Simplification of procedures

• Take an integrated approach to simplifying
  procedures. Procedures should be readily
  available for reference purpose.
• Single Window Inspection
• Shared border facilities
• Equipment
• Infrastructure
• Date
• Intelligence
• Documents
• Any other

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12. Preserve and leverage the following
achievements.

• Free movement of goods, services and people.
• Open border.
• Payment of goods and services in Indian currency.
• Right to engage in economic activities in each
  other country.
• These be incorporated in treaty of trade.

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13. Misc Issues

• Provision for import of second hand machinery by
  Nepal.
• Export of 3rd country or Indian Plant and
  machinery for repair and maintenance into India.
• Sales of 3rd country or Indian second hand plant
  and machinery into India.
• Import of 3rd country goods from India to Nepal.
• Formal linkages between capital market of both
  the countries need to be established.
• Nepal has to open up permission for joint
  ventures in India and abroad.
• Export and Import of scrap wastages.
• Protection of intellectual property rights.