Nepal’s export to India adversely affected by GST

Vastavam web: Nepal’s export to India has been adversely affected after the enforcement of Goods and Services Tax as Nepali goods have become less competitive in the Indian market due to high duty in post-GST period, a media report said today.Trade of major export items to India, which were enjoying zero duty or nominal tariff earlier, has dropped significantly, the Himalayan Times reported citing the Nepal Rastra Bank s recent report.The country exported juice products worth Rs 344 million in first two months of the ongoing fiscal as compared to Rs 800 million in same period of previous fiscal.
Export of juice products to India was on the rise since last several years as the Indian multinational Dabur Nepal was the largest exporter of juice to India.According to the central bank’s data, export of juice had surged by 50 per cent in the first two months of fiscal 2016- 17 compared to the corresponding period of fiscal 2015-16.This means the Indian market has become 5.82 per cent costlier for juice exporters after implementation of the GST, it said.
Likewise, export of large cardamom plunged by 45.3 per cent, fruits (85.9 per cent), vegetables (39 per cent), noodles (34 per cent), jute goods (2.3 per cent) in first two months of this fiscal as compared to corresponding period of last fiscal.As Nepal’s top export items have been hit hard since enforcement of the GST, country s export to india is likely to drop.Shekhar Golchha, senior vice president of Federation of Nepalese Chambers of Commerce and Industry, said that Nepali goods have become less competitive in Indian market as they have to pay high duty in post-GST period.