(TibetanReview.net, Nov11’24) –India’s ties with today’s seemingly China-beholden Nepal is not as friendly as it historically used to be, while the India-China ties are far from normal, with the Oct 21 Depsang and Demchok patrolling deal being only the first step in a long and arduous process. But whatever may be the case, manufacturers and exporters in Nepal say they are in a dilemma over trade with India following restrictive measures imposed on their goods by New Delhi which wanted to ensure they were free of Chinese components, reported the kathmandupost.com Nov 10.
The Nepali government is silent on the issue even though the goods have not been sold to India for months, the report said.
In 2020, the Indian government asked the Bureau of Indian Standards (BIS) to prescribe mandatory standards for imported goods in line with international quality norms. The move was stated to be aimed to prevent Chinese goods from entering India from any of its neighbours.
India-China relations plunged to their nadir since 1962 in mind-2020 following the Galwan valley clash in Ladakh in which 20 Indian and at least four Chinese soldiers lost their lives.
India imposed a series of economic measures against China, which included banning a large number of popular Chinese mobile apps. India also imposed import restrictions on more than 370 Chinese products, the report noted.
The report cited “insiders” as saying India does not want any products from Nepal that have Chinese components, including Nepal’s hydroelectricity, greatly worrying Nepal’s top exporters.
The BIS deals with the marking and certifying of goods, incorporating quality standards and information on international norms to be followed while importing.
Sanitary pads and diaper factories, for example, used to operate 12 hours a day when the demand in India boomed, but due to the export obstacles, factories have reduced operating hours by 4 hours, Dol Raj Adhikari, president of the Nepal Sanitary and Diaper Association, has said. Adhikari owns the AG Health Industries Private Limited that produces sanitary pads and diapers in Bhairahawa.
According to the association, Nepal used to export three truckloads of sanitary pads and diapers daily. There are 29 sanitary pads and diaper factories in Nepal, large and small, employing 6,000 workers, the report said.
Likewise, a big consignment of Goldstar shoes failed to get export clearance after India refused to issue the BIS certificate, putting Nepal’s home-grown shoemaker on the brink, the report said.
The BIS certificate issue is stated to have put the industries in Rupandehi in a big dilemma. “They were opened to export goods to India,” Thakur Kumar Shrestha, president of the Siddhartha Chamber of Commerce and Industry, has said, adding, it has negatively impacted both the industries and Nepal’s trade.
He has said factories were either running at half capacity or getting shut down, with workers being laid off.
Exports from the cement makers in Rupandehi—such as Arghakhanchi Cement, Sarbottam Cement, Palpa Cement, and Balaji Cement—have completely stopped for nearly two months, the report said.
Except plywood, the export of all the listed goods that require a BIS certificate has come to a halt, Shrestha has said. “India has neither renewed the certificate nor provided a new one.”
Plywood has been given until Mar 2025 for certification-free export, the report said.
Out of 80 plywood factories, 52 had deposited charges to obtain the BIS certificate. However, after completing the process in June, the inspection team from India has not provided a BIS certificate so far, Hom Prasad Ghimire, president of the Nepal Plywood Manufacturers Association, has said. The plywood industry employs 25,000 workers across Nepal.
Posh Raj Pandey, chairman of the South Asia Watch of Economics, Environment and Trade, has said lack of coordination among government agencies and frequent changes of bureaucrats had put the issue on the back burner.