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The WTO agreement, a multilateral trade arrangement (MTA), is not a signed agreement. Nepal has been implementing it through the negotiation process for about 1.5 decades. While acquiring WTO membership, Nepal had made commitments on trade in goods, including farm products, trade in services and commitments on TRIPS along with legislative and adjudication commitments. These commitments, including commitments on legislative and adjudication, remain unfulfilled.  

Some of the trade opportunities of the WTO arrangements are security at market access opportunities, uniform sets of rules at borders, fair trade opportunities through elimination of quotas, predictable trading environment, counter to unfair trade practices and access to dispute settlement bodies.

Some of the negative impacts of the WTO arrangements are market access constraints and negative impact on business.

Market access constraints include tariff barriers to poor countries, and constant decline of commodity prices across the countries whereas negative impacts include threat to domestic industry from free imports, revenue loss to government, erosion of SME’s special privilege, farmers’ right to seed (Patent problem), reduced food security due to low productivity and others. 

The implementation of South Asian Free Trade Agreement (SAFTA), which began in 2006, stipulates reducing customs duty between 0 and five percent by 2015. However, full implementation of SAFTA has not materialized in a real sense with even exportable products in SAFTA’s sensitive list, though Nepal has reduced the number of sensitive products included in the list to about 1,000 from 1,295. After 2006, countries in the South Asian region have reduced the customs duties to boost intra-South Asian regional trade, which remains below five percent. It is difficult to evaluate the overall impact with import of goods under SAFTA provisions not yet started and revenue compensation mechanism not yet implemented. 

Still, it is quite difficult to reduce the customs duty on non-sensitive products. 

Poor transport network, a difficult access to ports, difficulties in implementation of rules of origin, insufficient trade facilitation measures, un-uniformity in TBT-SPS provisions and documentation within the SAARC region countries have reduced the impact of SAFTA.

We are on the way to achieving greater market access, preferential market access facility and transport, including transit way access. Nepal’s trade with SAARC member-states, barring India, is insignificant as yet. 

Besides SAFTA, there are India-Sri Lanka Free Trade agreement/FTA(1998) and Pakistan-Sri Lanka FTA (2002) for bilateral trade promotion. Nepal has entered into bilateral trade agreements with some countries in South Asia, namely Bangladesh, India, Pakistan and Sri Lanka, which are crucial for implementation of SAFTA provisions. 

Supply-side constraints, lack of infrastructure, lack of standard lab, trained human resources and coordination can be reduced by implementing bilateral trade agreements within South Asian countries. Bilateral agreements can help increase trade volume within the SAARC region, which is still low, pointing at the status of implementation of these agreements. 

Impractical provisions of SAFTA and bilateral FTA are also to blame for a grim regional trade and cooperation scenario. This calls for integration of SAFTA with the South Asian Regional Investment and Trade Agreement (SARITA).

India and Pakistan perhaps offer the best example of delayed implementation of SAFTA. The relation of individual countries in the South Asian region with the USA and other wealthy countries can explain the status of implementation of SAFTA.

In this context, trade liberalization in the South Asian region will reduce the cost of products in the value chain and supply chain, directly benefiting consumers of countries within the SAARC region. 

Policymakers have considered only some aspects of trade-related consumer welfare and full implementation of SAFTA is still a far cry. 

The current volume of intra-regional trade in South Asia is a paltry 4.8 percent of the total trade of the countries in the region. 

To boost intra-regional trade and economic cooperation, the highest priority should be on dialogue between politicians, producers and consumers along with trust-building initiatives on the part of the civil society.

The writer is a former deputy executive director of TEPC. Views are personal

Competition is rife in today’s world that is struggling to overcome the impact of the Covid-19 pandemic and several other adversities like international tensions.   

Millions of people are struggling for well-paid jobs in a knowledge-based society and want high living standards. Of course, a good education is a prerequisite for getting a good job, but it is hardly enough. Factors like technical-practical skills, knowledge and relevant experience also matter a lot when it comes to landing a job, plum or not.

Today’s job market requires that an ideal candidate has adequate skills, training, relevant experiences and a sound academic background, among other factors.   

Even if a candidate in question has an excellent academic background, s/he often has to be content with a junior position in the absence of relevant skills/expertise and experience.   

Technical skills should be given top priority while hiring for technical jobs, whereas knowledge of diverse areas (general knowledge) should be a major criterion for candidates wishing to join public service. 

By conducting an interview, interest, aptitude and creativity of a candidate wishing to land a job can be assessed along with academic qualification. By the way, non-academic life skills like driving also enhance the prospects of job-seekers.

While selecting a candidate, appropriate standard/principle/medium should be employed with an eye also on criteria like academic qualification, accountability, personality, punctuality, honesty, a pragmatic bent of mind as well as technical skills. 

An academic degree is the result  of one’s hard-work and  patience. But an education system should not dissociate itself from practical aspects of life. Degrees without practical experiences cannot be  useful enough in today’s job market that requires diverse skills and expertise.  

Individuals with high degrees lacking skills to complete a simple task do not bode well for an education system. 

A job market requires candidates who are smart, capable,  educated, experienced, focused and laborious.

While education gives an individual theoretical knowledge and analytical skills to show why something does not work, experience teaches that ‘doing  a thing in a certain way does not work’. 

No doubt a medical student can be a better doctor and management student a better manager because universities design courses catering to the needs of respective sectors. Generally, an academically qualified person can obtain related practical skills better and  earlier in a relevant field of  work. Hence, academic degree, internship, dissertations based on field survey and positive  thinking with a well working  attitude  should be the job.

Traditionally, obtaining an academic degree has been our main priority, while recent years have seen a shift in priority toward acquiring skills and expertise. 

An ideal candidate should have skills and expertise along with an excellent academic background. Different philosophers have offered their nuggets of wisdom on theoretical and practical knowledge. There’s no doubt that candidates need different skill sets to stay relevant in today’s job market.
Big multinationals like Google, Facebook and Amazon, for example, are hiring  people with adequate  skills rather than academic degrees. This is because there is no guarantee that those holding academic degrees will be able to solve problems facing the real world.

The country’s education sector should be  overhauled with a greater emphasis on vocational education. Our university education must accord top priority to fields like agriculture, fisheries, forestry and rural technology with a vision to modernize them as per our needs. Social science programs must be launched at universities after conducting surveys on the country’s human resources requirement.    

Summing up, in the post-Covid era, increased focus should be on honing professional expertise and skills through education and training for effectively fighting adverse impacts resulting from the pandemic.

The author is a former Deputy Executive Director of TEPC under the  Ministry of Industry, Commerce and Supplies

Since its establishment in December 1985, the South Asian Association for Regional Cooperation (SAARC) has sought to increase economic integration between India, Pakistan, Bangladesh, Nepal, Bhutan, Sri Lanka and the Maldives. This bloc, designed to accelerate economic and social progress of member-states, has failed to deliver while similar regional trading bodies such as the European Union, ASEAN, BIMSTEC and NAFTA continue to do quite well. Contrary to the four above-mentioned bodies, trade between SAARC member-states has remained limited, though these states are in close proximity and each of them is part of world trade. A growing emphasis on attracting foreign investment and seeking access to new markets in the SAARC region indicates that economic progress is central to the future of South Asia. Historically, SAARC has played a limited role and this is unlikely to change in the  foreseeable future because of India’s considerable position of power over other SAARC states. This imbalance of power allows conflicts between India and its neighbors to undermine economic integration within the SAARC framework. This factor resulted in the establishment of BIMSTEC consisting of SAARC states and Thailand, a Southeast Asian country. Non-consensus between South Asian countries on different issues has rendered regional trade agreements largely ineffective, making way for SAARC states to advance their economic interests through bi-lateral agreements, thereby reducing their incentives to engage multilaterally. In the future, SAARC is likely to become more of a forum for regional negotiations through conferences and seminars than as an architect of regional economic policy. Over the decades since the establishment of SAARC, India and some other member-states have increased their focus on economic development. Since 1991, when a debt crisis forced it to undertake a serious program of market-oriented economic reforms, India in particular and other South Asian countries in general gradually opened up their economies to the world. Over time, the South Asia region has moved from a closed economy with heavy central planning to a more privatized economy with lower tariffs, resulting in increased growth rate for the regional economy after 1991. Foreign investment has been increasing in India and other South Asian countries after the start of economic liberalization in the region. To sustain their growth, these countries have sought access to new markets and an increase in foreign investment. Foreign policies of countries in the region have placed serious emphasis on increasing their economic growth. This emphasis on growth is likely to continue in the future. Looking back, the shift toward market economy in 1991 brought ‘irreversible’ changes in the region's economic thinking—changes that will force this region to remain active in the global economy. A majority of South Asian leaders, irrespective of their political parties, believe that globalization and privatization are necessary for the whole region to reduce its mass poverty. This has led SAFTA signatories to gradually reduce tariffs and other trade barriers over the past decades, while several other commitments remain on paper. Nepal and Sri Lanka, both reliant on the Indian economy as a supplier and market for their goods, would like to increase intra-regional trade and foreign investment in their developing industries. Bangladesh is also looking for new markets to export goods. These examples show SAARC states want regional trade to expand. But the very structure of SAARC often makes regional cooperation difficult. Within the SAARC, India is the strongest member-state in terms of economic gains and international influence. Its regional supremacy gives SAARC the unique features not found in ASEAN. Pakistan was initially unwilling to join SAARC, fearing that the Indian domination would end up rendering the bloc ineffective. Smaller states in South Asia realize that they will need India’s help to facilitate faster economic growth, though they are reluctant to work with India fearing the latter’s dominance of SAARC. Bangladesh is afraid of India exploiting its geographical location to redirect water flows vital to its farms. Nepal and Bhutan are still worried about India’s control over their world trade and transit links as their geographical position will always make them dependent on India. These and other neighboring realities have directly affected SAARC. Attempting to promote regional cooperation while doing little to resolve regional conflicts makes realization of SAARC’s cherished goals nearly impossible. Moreover, SAARC has no up-to-date institutional mechanisms that can address the issue of lack of consensus on thorny issues . Currently, trade between South Asian states remains relatively low compared to other regional blocs. Moreover, political and economic ties between states rest on shaky foundations. Non-consensus  among countries in the region have made regional cooperation difficult, making way for bilateral efforts to achieve economic goals. SAARC is still a valuable forum for political dialogue in South Asia, but conflicts and tensions between member-states have taken a toll on its possible economic role in the region. Until these conflicts are resolved to the point where South Asian states are willing to reduce barriers to trade, an economically interdependent South Asia seems to be more of a dream than reality. In such a context, will BIMSTEC be able to reactivate the  SAARC? The author is former deputy executive director, Trade and Export Promotion Center  

Export is sweet  because  of the money in it. Consider the world as your market. Choose export-oriented industries that are competitive, and promote them. Some of the export incentives like duty drawback, excise refund, customs refund and vat refund are cash compensatory. The export product selection in Nepal is heavily based on the labor content of  products, promotion of labor-intensive products such as sunflower oil, soybean oil, thread, carpets, Pashmina,  garments, handicrafts and promotion of skills-based  products like software. Pricing is a matter of strategy. Decisions related to pricing affect cash flows and margins much more rapidly than any other marketing decisions. But this factor has not been considered in Nepal. Distributive options for export marketing are: establishment of distribution and sales offices abroad, appointment of distributors and agents, direct sale to importers and members at the bottom of the distribution channel such as department store, chain store or boutique, and end users. This mostly happens in tender business. Selection of  an appropriate  agent  requires a good  deal  of  homework. Model agency profiles must  assess character, capacity and capital. Points  to be considered  while selecting  agents are the size of  the agency firm, desirable  outlets,  complementary product life,  specialized sales staff, location, marketing  facilities, identification  process, selection process, details  regarding  the firm, details  regarding  business  conducted,  references  of agency  firms, and  selection of the relationship between the parties and the products. But this aspect is lacking in Nepal. One of the considerations in channel selection is its impact on final costs. Under the  Bangkok  agreement  negotiated  under the UN’s ESCAP, the import of specialized  items are allowed in the participating countries at over MFN rates. In addition to the customs duties normally chargeable , there are two special  duties that a government of the importing country can impose under specific  situations. These are the anti-dumping duties and the countervailing duty. Anti-dumping duties are  imposed when governments of importing countries can prove that foreign exporters are selling their  products at less than fair prices, which are  causing  damage to competing firms. Countervailing duties, on the other hand, can be  payable if it can be proved that respective governments are subsidizing exports, enabling the firms to lower their prices. Some  forms of export subsidy are not allowed under the GATT (WTO) system. But this knowledge is lacking in Nepal even though we have some acts to govern the system. Some countries  have a twin system of import control: one control through import licensing and the other through foreign exchange authorization. Import deposit scheme is also practiced by some governments. Some quotas are extensively used both in developed and developing countries' markets. Quotas  are administered  through the import licensing  system. Among the various types of quotas, some of the important ones are import control regime and non-tariff  barriers. These include  standard regulations, administrative measures which make imports difficult, health and sanitary regulations. Different countries have different systems for assessing the duty payable on imports. GATT (WTO) has tried to bring uniformity in customs valuation procedures through what is known as the customs valuation code. Consumer product features are: color preferences, pack sizes, styling, features, material used, usage conditions, use preferences. In packaging for consumer goods, color preferences preferred, container form, preferred  material for packaging, preference for reusable, container packaging requirements for channel members, packaging, requirements in terms of product needs, protective needs should be considered. Packaging requirements for shipping cover mode of transport, port handling charges, storage conditions in material and bonded warehouses. Legal requirements for product cover labeling requirements, band on the use of specific use of input and mandatory safety regulations. Marketing  strategies formulation covers buyer's profile on the basis of demographic, psycho-graphic, location-wise clusters, preferred purchase outlets, purchase decisions, the country image in the buyer's  perception. Competition arrangements cover main competitors, production-related competitive profile in terms of product quality, price, delivery and services and identification of market segments. Marketing channel  covers the areas related to the channel available, channel being used by dominant suppliers, accessibility to the desired channel, cost of entering channel and needs of channel members. Physical distribution includes mode of transportation required, cost of transportation, packaging requirement and warehousing needs. Pricing and payment terms cover prevailing prices, normal quotation terms, preferential invoicing currency, normal payment terms and normal credit period allowed. Under promotion, media available and costs of  media used by dominant suppliers should be taken  into account. Product supply profile includes product description, standards used abroad, capability to conform to international standards, major producing countries, market centers, estimated production, major buyers and others. Government policy includes status under export policy, cash compensatory support, duty and duty drawback, requirements in payment terms, letter of credit,  if any. Besides these, export tricks and techniques can be learned from the other country's export promotion experience. The author is former Deputy Executive Director of Trade and Export Promotion Center