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Export demand revives Nepal's garment industry

Nepal's apparel exports which languished due to political instability, is now witnessing a rise in export orders from foreign buyers. Apart from other destinations like Bangladesh and Cambodia, importers are now also placing orders with Nepalese garment makers.

As per Trade and Export Promotion Centre, Nepal exported 2.72 billion Nepalese rupees in garments in the first six months of the current fiscal year. This is 50 per cent more than Nepal's export of garment products during the same period of last fiscal year.

Through the 1990s, the garment export industry was Nepal’s largest employment generator, providing more than 50,000 jobs and hundreds of factories operating day and night to manufacture export products for clients in the US, Europe, Canada and Japan. But gradually industry declined due to a phase out of protectionist quotas by the World Trade Organisation (WTO), instability triggered by the Maoist armed insurgency, and the rise of trade unionism. Ready-made garment exports were worth more than 11.5 billion Nepalese rupees in fiscal year 2002-2003. By fiscal year 2008-2009, they fell to 4.5 billion Nepalese rupees.

However, experts feel that initiatives like zero tariffs are required to keep the momentum alive and also to attract foreign investment. The government needs to help the industry with export subsidies and soft loans to revive and promote Nepal’s garment products. 

 
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