July / August 2002



36th AGM of FNCCI Concluded

The 36h Annual General Meeting (AGM) of the Federation of Nepalese Chambers of Commerce & Industry (FNCCI) was held on 30-31, 2002 in Kathmandu. The AGM deliberated on various issues and passed resolutions asking for prompt government actions on them.

The AGM was inaugurated by the Prime Minister Sher Bahadur Deuba amid a special function on July 30, 2002.

Addressing the inaugural session of the AGM Chief Guest Prime Minister Deuba announced that His Majesty's Government would bring out a new Industrial Policy and Competition Policy in order to face the challenges of global competition.

The Prime Minister also appealed to the private sector to utilise the opportunities resulting from the growth quadrangle concept put forth with the cooperation of donor countries to explore future areas of cooperation, development of infrastructure, trade and investment among the South Asian countries.

On the occasion Prime Minister Deuba also observed the exhibition exhibiting goods produced by women of various districts of Nepal.

Minister for Industry, Commerce & Supplies Purna Bahadur Khadka said that the government has adopted the principle of partnership with the FNCCI and the government has been making necessary preparations to review the policies related to foreign trade and investment. He further noted that the consensus from all sectors is being sought before giving the 20 year industrial perspective plan its final shape.

Delivering a welcome speech during the inaugural session of AGM, FNCCI President Ravi Bhakta Shrestha said that it was the need of hour to be cautious over economic issues rather than being entangled that in political disputes.

He further said, he found regrettable is that the His Majesty's Government of Nepal has failed to give adequate attention to economic diplomacy at a time when the FNCCI was asking international community for a duty free access for the country's indigenous products.

President Shrestha also handed over a cheque for Rs. 5,11,111 to the Prime Minister on behalf of the FNCCI for the victims of flood and landslides in various parts of the country.

Proposing the vote of thanks, First Vice President of FNCCI Binod Bahadur Shrestha noted that industrialists and businessmen were discharging their responsibility towards the nation by investing 'in various industrial and business sector.

Participants from all over the country participated on the AGM.

Economic Debate urges Government for National Consensus and Common Vision for Economic Development

The views of political parties on Nepal's overall economic policy and future policies were expressed the programme organised in Kathmandu on July 31, 2002 by the Federation of Nepalese Chambers of Commerce & Industry (FNCCI).

Speakers at the "Economic Debate" on the topic "Long Term Vision: The basis of economic progress" held on second day of the FNCCI's 36th Annual General Meeting stressed the need for all out reform in Nepal's floundering economy.

Political parties and business community felt that there was a dire need for a "National Consensus" and "Common Vision" for economic development that should guide each government's development endeavour.

Participating in the discussion National Planning Commission Vice Chairman Dr. Narayan Khadka spoke of the need for reviewing past policy and for an egalitarian, balanced and longterm programme to bring about an equilibrium between industry and agriculture. village and town.

In the discussion, Dr. Prakash Sharan Mahat from Nepali Congress opined that there was a serious need for confidence amongst the government, private sector, civil society and other nongovernmental organisations.

Binaya Dhoj Chand from the Nepali Congress said that a good coordination between politics and economics was lacking.

Bharat Mohan Adhikari from CPN-UML lambasted the government for the lack of accountability, high degree of corruption and ineffective implementation of high sounding policies.

Dr. Prakash Chandra Lohani of Rastriya Prajatantra Party said that the thrust should on food, shelter, clothing, health and transportation sector to attain accelerated growth.

Khusilal Mandal of Nepal Sadbhawana Party called for a green revolution and a white revolution.

Ghanashyam Sharma Poudel of Janamorcha Nepal drawing the government's attention on the need to make investment in light industries such as software, said that the abundant labour of the country should be effectively utilised to attain higher growth.

Speaking from the chair Ravi Bhakta Shrestha, President of FNCCI, strongly urged for the strong implementation of the plans. The government officials must take-up their responsibilities, sensibly and give due attention to economic issues, which has largely been sidelined by political agenda. He also said Nepal has been used as a guinea pig in the name of economic development.

Rajendra Kumar Khetan, Second Vice President and Spokesmen of FNCCI and Convenor of the programme spoke about the aims of the discussion programme while senior Journalist Ram Krishna Regmi summerised the discussions as a moderator.

MOU on HIV/AIDS Signed between FNCCI & UN Theme group

Concerned with the spread of HIV/AIDS in the country, the Federation of Nepalese Chambers of Commerce & Industry (FNCCI) and the UN Theme Group (UNTG) signed a Memorandum of Understanding on HIV/AIDS in Kathmandu on 20 August 2002.

The MOU was signed by FNCCI Employers' Council Chairman and Ex-officio Vice President Suraj Vaidya on behalf of FNCCI President Ravi Bhakta Shrestha and Chairperson of UN Theme Group of HIV/AIDS Bill Musoke.

As per the MOU the UNTG on HIV/AIDS will provide FNCCI consultancies to:

Facilitate the process of creating awareness about HIV/AIDS within FNCCI (including district chambers) and among FNCCI members; Support and facilitate the integration of HIV/AIDS as an agenda point in annual district chamber meetings; Support the development of a decentralized pilot programme to strengthen the capacity of members of FNCCI and one selected priority district; Support and facilitate the development of an HIV/AIDS policy framework for FNCCI; Facilitate and support HIV/Aids prevention programmes at the workplace.

Funds for transport needed to develop and monitor the pilot programme in the selected priority district will also be provided

Similarly, FNCCI will provide; A full time qualified FNCCI staff to work together with the consultant in order to create capacity on HIV/AIDS issues within FNCCI and ensure sustainability of the initiated HIV/AIDS activities and an office space for the consultant, including computer, telephone and other basic office equipment needed in order to work efficiently.

An executive board consisting of representatives from FNCCI and the UNTG on HIV/AIDS will meet once quarterly to discuss the progress of the programme as well as decide on new programme activities.

FNCCI-CII Joint Economic Council reconstituted

The FNCCI has constituted the FNCCI-CII Joint Economic Council (JEC) from FNCCI side under the Chairmanship of FNCCI President Ravi Bhakta Shrestha.

Suraj Vaidya, Diwakar Golchha, Kishore Khanal, Kush Joshi, Kumud Dugar, Joy Dewan, NICCI Representative and Badri Ojha are the members of the reconstituted JEC from the FNCCI side. FNCCI

Former President Padma Jyoti will be the Senior Advisor.

With a view to preparing joint recommendations for the Nepal-India Intergovernmental Committee Meeting and charting out future course of actions including (a) export and investment promotion programmes in selected states of India, (b) special Nepal session at the World Economic Forum and CII Partnership Summit in India, (c) Joint Trade Fair/Exhibition in Nepal and India, (d) Summit on Child Labour in Nepal, and (e) Corporate Governance, the JEC Meeting was held on 14th August 2002 in New Delhi.

The first meeting of the JEC was inaugurated in February 1996 in Mumbai by Sher Bahadur Deuba during his official visit to India as Prime Minister of Nepal.

Luncheon hosted by SCCI/FNCCI

SAARC Chamber of Commerce & Industry (SCCI) and the Federation of Nepalese Chambers of Commerce & Industry (FNCCI) jointly hosted a luncheon on 22 August in honour of the Foreign Ministers and delegates of SAARC countries. Who had came to take part in the 23rd ministerial level meeting of the South Asian Association for Regional Cooperation (SAARC).

On the occasion President and Office bearers of SCCI and FNCCI also presented momentoes to the SAARC Foreign Ministers.

Nepal, India agree tor concessions on trade, transit

A meeting of the Nepal-India Inter Governmental Committee meeting concluded in New Delhi on 17 Aug. 2002.

The Nepalese delegation at the meeting was led by Secretary at the Ministry of Industry. Commerce and Supplies Bhanu Prasad Acharya and the Indian delegation by Indian Commerce Secretary Dipak Chatteraji.

According to the Royal Nepalese Embassy in New Delhi, discussions were held on maters of mutual concern related to trade, transit, investment promotion and prevention of unauthorized trade.

During the discussions, an understanding was reached on holding another round of talks within a month to operate train services for the dry port at Birgunj, and on setting up a quarantine check post at Jogbani, Sunauli and Banbasa by November 1 to solve the problem in the export of Nepalese agro-based products created by the quarantine check-posts.

The Indian side has given positive assurances on reducing the quarantine fee in response to a request made by Nepal.

Besides, the governments of India and Nepal have reached an understanding on holding discussions in the near future on the promotion and protection of bilateral investment.

The Indian side has given the Nepalese side assurance to remove the special additional duty levied on vegetable ghee, acrylic yarn, copper wire, etc exported from Nepal.

Indian side also agreed to remove the luxury tax imposed by the West Bangal government on Nepalese goods.

The Indian side has also agreed to increase the annual export quota of copper products from Nepal from 7,500 metric tons to 10,000 metric tons and to make provision not to charge excise duty on refuelling of aircrafts of the Royal Nepal Airlines Corporation at the Airports in India.

India revokes Special Additional Duty

The government of India on August 28, 2002 removed the Special Additional Duty (SAD) of 4 percent that was imposed on some Nepali products during the Indian budget announcement for the current fiscal year that ends on March 31st, 2003.

"The Indian government has sent a notification to this effect. SAD has been removed from all three items, including vegetable ghee, copper winding wires and acrylic yarn, with immediate effect," confirmed Nagma M Mallick, First Secretary Commerce, Embassy of India, Kathmandu.

The removal of SAD closely follows the heels of the recently concluded secretarial-level Nepal-India Inter-Governmental Committee meeting at New Delhi that concluded to resolve the existing barriers to trade between the two countries.

The Nepali delegates had urged the Indian government to remove SAD, including anti-dumping duties and local duties, among others.

Nepal, Bangladesh agree to enhance bilateral trade

Bangladesh has agreed to provide warehouse facilities for Nepalese cargo at mangla port, besides providing a 50 percent rebate for goods on transit. It has also agreed to extend the 'free time' to clear the cargo from the port.

The Commerce Secretary level talks between Nepal Bangladesh that concluded on August 27 in Kathmandu reached an agreement on this. The 2 day meet also agreed to come up with the necessary infrastructure to develop a land port at Banglabandh by December. Bangladesh will also consider Nepal's demand that it open up its market for Nepalese agricultural products.

The meet ended with an agreement to expedite trade between the two countries, with particular emphasis on opening new areas of trade. Nepal's export to Bangladesh consists of lentils, while Nepal imports jute products, machinery and fertilizer.

Despite the geographic proximity, both the nations have not been able to exploit the trade potential to the maximum. Trade between the two countries is only about Rs. 800 million. Lack of physical infrastructure, banking and warehouse facilities at the Bangladeshi border point of Banglabandh has been hindering trade between the two countries.

The talks also accorded priority to promoting relations between the private sectors of the two countries.

A press release issued simultaneously by the Ministry said the meet agreed to finalise the agreement on transportation between the two countries in the near future. Bangladesh has also agreed to construct a bridge over the Rupsa River within two years to expedite trade.

During the meet, both countries agreed to hold trade fairs to promote trade. Air services from Bhadrapur, Biratnagar of Nepal to Shahidpur of Bangladesh will be initiated.

Nepal, on its part, has agreed to study the proposal of Bangladesh to carry out trade on the basis of Accounts/Counter Trade, the press release said.

Nepal, Bangladesh, Bhutan and India to set up FTA

The South Asia Business Forum (SABF) agreed an August 13, 2002 to double trade in three years from the present of $ 2.5 billion and work towards establishing a Free Trade zone among Nepal, Bangladesh, Bhutan and India.

The Forum, which concluded its first two-day Annual meeting in New Delhi, noted that the Indian government has offered unilateral concessions but the need is to move towards a more wholesome arrangement leading to a Free Trade Area (FTA).

The SABF, set up by the apex Chambers of Bangladesh, Bhutan, India and Nepal in association with the Assian Development Bank (ADB), brought together senior policy makers and business leaders from the four countries to chart out a strategy for enhancing private sector co-operation in the region.

The Forum agreed to lobby at the political level for harmonization of custom procedures and documentation in the South Asia Sub-Regional Co-operation (SASEC) and for uniform banking and insurance practices to take care of exporters requirements.

Foreign importers can open liaison offices

His Majesty Government has decided to allow foreign companies importing Nepali goods and services to open liaison offices in Kathmandu. The move is aimed at promoting export of Nepali goods and services to other countries.

Foreign companies importing Nepali goods and services worth $500,000 will be eligible to open liaison offices in Nepal.

Necessary arrangements have been made at the department of commerce for foreign companies to open liaison offices in Kathmandu according to the Ministry of Industry, Commerce and Supplies.