Some time back, Nepal’s readymade garments received duty-free facility in the US market. The special trade preference allows duty-free tariff benefits for up to 66 types of garment items including certain carpets, headgears, shawls, scarves and travel goods. Nepali garments will now be competitive in the US market. The US accounted for over 80 per cent of Nepal’s total garment exports at one time. The US had been imposing an average 16 to 17 per cent duty on Nepali garments.

Nepal’s garment manufacturers welcome the duty-free facility to the US market but say there are other issues to be resolved. Only 40 per cent of Nepali garments being exported to the US are eligible for Generalised System of Preferences facility. The rest 60 per cent are excluded from GSP. Nepal’s garment manufacturers have been lobbying for duty-free entry to the US for over a decade.

Meanwhile, Nepal is wrestling with the slow pace of economic recovery following the earthquake. Infrastructure needs to be developed. Attention is being sought for timely completion of the proposed hydropower projects, tourism development and productive use of remittance. Garment makers are being urged to expand their production capacity to ensure regular supplies to their main export destinations.