Ministry of Commerce And Supplies - Enhanced Integrated ...

N T I S2010 Similarly, a bus service between Lhasa and Kathmandu, recently initiated for Tibetan tourists to Nepal,had to be stopped abruptly because of China’s restrictive visa policies and lack of transparency. Suchabrupt changes in Chinese policy undermine indirectly the reliability of the Nepalese tourism industryto the outside world, including Tibetan tourists.While such issues do not appear to be violations of China’s commitments and obligations under the WTO orbilateral treaties, unpredictable and unannounced measures by China do not contribute to creating a stableenvironment within which Nepal can develop sustainable exports.Government Procurement Restrictions, Export Subsidies, Intellectual PropertyProtection, Investment Barriers, Anti-competitive Conducts of State-owned orPrivate Firms, Restrictions Affecting Electronic CommerceNo such impediments or related restrictive policies were reported during the discussions held in Nepal withrelevant stakeholders and informed parties.Sector-specific IssuesWith respect to trade in the agro-food sectors identified in Chapter 2, NTBs, especially SPS standards areclearly a major impediment to Nepalese exports. Clearly, a lot of capacity-building is needed within Nepal tohelp exporters comply with the SPS standards not only in China but anywhere else where exports expansionis being sought. However,there is, also an issue arising from a lack of transparency on the part of China withrespect to requirements, the legal bases for those, and the procedures to be followed in accessing China’smarket.In relation to selected handicrafts, the key trade obstacle appears to be the application of erratic anddiscriminatory duties, together with the arbitrary application of customs valuation rules and the occasionalintroduction of trade restrictions and import bans justified on the basis of unknown or (presumably) religiousgrounds. The combination of these instruments appears to often effectively place Nepalese goods at acompetitive disadvantage vis-à-vis similar Chinese products.Traders also find it very difficult to comply with a wealth of import regulation permits and licences (asapplicable) that often discourage or actually prevent trade even in those few instances where Nepalese goodsare competitive and sought after by Chinese (mainly Tibetan) importers and consumers.With respect to the potential service exports identified in Chapter 2, most impediments to trade would seemto be Nepalese domestic in nature, though, as indicated above, there are Chinese issues affecting Nepaleseexports to Chinese tourists.142NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT