RESTRICTED  
  
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15 January 2019  
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Trade Policy Review Body    
 
* In Original language only/ En langue originale seulement /En el idioma original solamente . 
  
NEPAL 
DRAFT MINUTES  OF THE MEETING* HELD ON 3 AND 5 DECEMBER 201 8 
Delegations are invited to submit factual corrections, if any, on their own statement to the 
Secretariat ( Mrs Barbara Blanquart: barbara.blanquart@wto.org , or to  tprd@wto.org ) no later 
than 29 January 2019 . 
 
Organe d'examen des politiques commerciales  
 
NÉPAL 
PROJET DE COMPTE REN DU DE LA RÉUNION* TENUE LES 3 ET 5 D ÉCEMBRE 2018  
Les délégations sont invitées à soumettre  leurs éventuelles corrections factuelles concernant leurs 
propres déclarations au Secrétariat ( Mme Barbara Blanquart: barbara.blanquart@wto.org , ou 
tprd@wto.org ) le 29 janvier 2019  au plus tard.  
 
Órgano de Examen de las Políticas Comerciales  
 
NEPAL 
PROYECTO DE ACTA DE LA REUNIÓN* CELEBRADA LOS DÍAS 3 Y 5 DE DICIEMBRE D E 2018  
Las delegaciones pueden enviar a la Secretaría (Sr a. Barbara Blanquart: 
barbara.blanquart@wto.org , o tprd@wto.org ) a más tardar el 29 de enero de 2019  las 
correcciones fácticas que deseen introducir en sus propias declaracio nes. 
 
 
_______________  
 
  WT/TPR/W/159  • Nepal  
 
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  TRADE POLICY REVIEW  
 
NEPAL 
DRAFT  MINUTES OF THE MEET ING 
Chairperson: H.E. Mr Eloi Laourou (Benin)  
CONTENTS  
 
1   INTRODUCTORY REM ARKS BY THE CHAIRPER SON ................................ ......................  3 
2   OPENING STATEMEN T BY THE REPRESENTAT IVE OF NEPAL  ................................ ........  5 
3   STATEMENT BY THE  DISCUSSANT  ................................ ................................ ...............  9 
4   STATEMENTS BY ME MBERS  ................................ ................................ ........................  12 
5   REPLIES BY THE R EPRESENTATIVE OF NEP AL AND ADDITIONAL CO MMENTS  ...........  28 
6   CONCLUDING REMAR KS BY THE CHAIRPERSO N ................................ ........................  34 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: Advance written questions and additional questions by WTO Members, and the replies provided 
by Nepal are reproduced in document WT/TPR/M/381/Add.1 and will be available online at 
http://www.wto.org/english/tratop_e/tpr_e/tp_rep_e.htm.  WT/TPR/W/159  • Nepal  
 
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  1  INTRODUCTORY REMARKS  BY THE CHAIRPERSON  
1.1.  The second Trade Policy Review of Nepal was held on 3 and 5 December 2018. The Chairperson, 
H.E. Mr Eloi Laourou (Benin), welcomed the delegation of Nepal headed by Mr. Chandra Kumar 
Ghimire, Secretary of the Ministr y of Industry, Commerce and Supplies; the rest of the delegation; 
and the discussant, H.E. Ambassador Manuel Teehankee (Philippines).  
1.2.  The Chairperson recalled the purpose of trade policy reviews and the main elements of 
procedures for the meeting. The repo rt by Nepal is contained in document WT/TPR/G/381 and that 
of the WTO Secretariat in document WT/TPR/S/381.  
1.3.  Questions by the following delegations had been submitted in writing before the deadline: 
Kingdom of Saudi Arabia; Japan; United States; Canada; Ice land; Chinese Taipei; and Thailand. The 
following delegations submitted written questions after the deadline: European Union; and the 
Philippines.  
1.4.  During the previous TPR meeting in 2012, Members had noted that Nepal's economic growth 
had not resulted in t he strong development it needs in terms of job creation and poverty reduction. 
They had encouraged Nepal to address the supply -side constraints that impeded higher GDP growth 
rates, notably energy shortages, poor infrastructure, and labour strikes. Concern s had also been 
expressed about a worsening balance of trade, the falling participation of exports in GDP and the 
reliance on a few export products and markets. Members had urged Nepal to step up its efforts to 
diversify its export basket and seek new mark ets to limit its exposure to external shocks.  
1.5.  In the current review period, Nepal's annual economic growth averaged 4.4% despite the 
country being hit by two big earthquakes in 2015 which caused considerable damage to 
infrastructure and production. Estima tes suggested that eight million people were affected by the 
earthquakes, with some USD 7 billion in damages and losses. Growth recovered since then driven 
by good monsoons and higher government spending. As indicated by the advanced written 
questions, Mem bers were looking forward to learning more about Nepal's post -earthquake 
reconstruction and poverty alleviation efforts, and its overall economic outlook.  
1.6.  With regards to Nepal's participation in the multilateral trading system, Members also recalled 
that, at the time of the previous Review, they had commended Nepal for being the first least 
developed country (LDC) to join the WTO through the full accession process in April 2004. Members 
encouraged Nepal to pursue its regulatory and legal reforms and to fur ther adhere to WTO rules with 
a view to enhancing the transparency of its trade regime and thus contribute to attracting foreign 
investment. Since its last Review, Nepal ratified the Trade Facilitation Agreement and the Protocol 
Amending the TRIPS Agreemen t. Nonetheless, it had various outstanding notifications. Nepal 
continued to participate in two overlapping regional trade agreements: the South Asia Free Trade 
Area (SAFTA); and the Framework Agreement on the Bay of Bengal Initiative for Multi -Sectoral 
Technical and Economic Cooperation (BIMSTEC).  
1.7.  During this review period, Nepal adopted a new Constitution and shifted to a federal system of 
government. Moreover, new laws were enacted, such as the Special Economic Zone Authority Act 
2016 and the Industrial Enterprises Act 2016, and the implementing regulations were being drafted. 
Some other laws which were in development six years ago during the last TPR had yet to be 
presented to parliament, including a bill on contingency trade measures. The Chairperson wa s sure 
Members would like to know more about these institutional and legislative changes.  
1.8.  With respect to trade policy, at the time of the previous Review, Members had acknowledged 
the relative openness of Nepal's economy, and had expressed their satisfact ion that the adoption of 
the Customs Act and Regulation in 2007 and progress made in trade facilitation had simplified 
customs procedures and improved customs clearance. At the same time, however, Members had 
noted Nepal's weak standardization and conformi ty assessment infrastructure, lack of an 
accreditation system and sufficient testing facilities. Nepal's simple average applied MFN tariff 
slightly decreased from 12.2% in fiscal year 2011/12 to 12% in the current fiscal year.  
1.9.  Other issues of interest to M embers at the time of the previous Review in 2012 included the 
following: Nepal was urged to further liberalize its investment framework and address issues of weak 
institutional capacity; to broaden the scope of the competition law to include export busine ss and WT/TPR/W/159  • Nepal  
 
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  business relating to cottage and small industries; to improve the implementation and monitoring of 
its public procurement legislation; to further promote the participation of the private sector in the 
development process; and to strengthen IPR enfor cement. Questions had also been raised about 
the authorities' steps to review export taxes; make agriculture more productive; use its abundant 
hydropower resources to meet its increasing demand for electricity; and further liberalize services 
to improve th e efficiency of the economy, especially by reducing costs related to telecoms and 
transport.  
1.10.   The Chairperson drew Members' attention to some issues of interest derived from the advance 
written questions submitted for this TPR. These included, among others,  the following: outstanding 
notifications, particularly on agriculture, import licensing, and SPS -related measures; steps 
envisaged to further improve the business environment and attract larger FDI inflows; status of the 
Bill on safeguards, anti -dumping a nd countervailing measures; operation of Special Economic Zones; 
enforcement of intellectual property rights; and plans to further liberalize the services sector.  
1.11.   This meeting was a good opportunity for Members to discuss in greater detail issues of intere st 
to them and of systemic importance to the multilateral trading system. The Chairperson looked 
forward to a fruitful exchange.  
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  2  OPENING STATEMENT BY  THE REPRESENTATIVE OF NEPAL (MR. CHANDR A KUMAR 
GHIMIRE)  
2.1.  It is my privilege and honour to lead the delega tion of the Federal Democratic Republic of Nepal 
in the Second Trade Policy Review at the WTO. The Government of Nepal welcomes this as an 
opportunity to bring new dimensions in our trade in a timely manner.  
2.2.  My delegation wishes to express our sincere tha nks to Ambassador Laourou for chairing the 
session and the stimulating opening statement. We appreciate the role of Ambassador Teehankee 
as discussant. We also thank the WTO TPR team led by Mr. John Finn for the comprehensive coverage 
of issues in Nepal TP R report.  
2.3.  In the review process, we have received 137 advance written questions from nine WTO 
Members before and after the deadline. In response, we have so far replied to 128 questions, 
including those that were received after the deadline. The remaining nine questions received after 
the deadline will be replied to within the schedule. We would like to express our sincere thanks to 
all members for your abiding interests in the trade sector of Nepal.  
2.4.  Since Nepal's accession to the WTO in 2004, as the first LDC through the full working party 
negotiations, Nepal has remained an ardent supporter of the rules based, non -discriminatory, 
member -driven multilateral trading system. We have continued the process of policy and 
institutional reforms following the first  Trade Policy Review in 2012. We are constructively engaged 
in the World Trading System to best utilize the available and potential opportunities for economic 
growth, poverty reduction, employment creation and thereby achieving sustainable development 
goals in our national context.  
2.5.  Let me quote Ms. Christine Hochstatter, the discussant in the first Nepal TPR, who underscored 
that Nepal bound almost 100% of its tariff lines when it acceded to the WTO, made extensive 
commitments under the GATS and as an LDC made quite a remarkable set of commitments. 
Additionally, other observers have time and again commended that in doing so Nepal has made 
these commitments for strengthening the multilateral trading system.  
2.6.  Let me present the contours of political and econo mic development as well as major policy 
reforms made during the review period and challenges that lie ahead.  
2.7.  Since 2012, Nepal has undergone a historical transformation in its political landscape. Now it 
has a federal democratic system of governance. The p romulgation of the Constitution in 2015 laid 
down a solid foundation for Nepal's socio -economic transformation by ensuring the principles of 
democracy, federalism, secularism, and inclusive participation of all in State activities. The new 
governance syste m works at three levels: federal, provincial and local. Three elections held 
successfully within 2017 activated all the three levels of governance. That ushered in a new era of 
peace and stability. And, the voyage to prosperity has begun in Nepal.  
2.8.  The cur rent Government with a two -thirds majority in the Parliament has envisioned the goal 
of "Prosperous Nepal, Happy Nepali". To achieve this, the Government aims at socio -economic 
transformation through faster poverty alleviation and high economic growth with  productive 
employment and equitable distribution. The Government has targeted to achieve an economic 
growth of around 8% for the current fiscal year and double -digit growth in the next five years. In 
this regard, rich endowments, such as hydropower and to urism resources, as well as demographic 
dividend will be optimally utilized in our trajectory to economic transformation.  
2.9.  The Nepali economy suffered adversely from the devastating earthquakes in 2015 as well as 
subsequent serious disruption of supplies at  the southern border. Nevertheless, Nepal's economic 
growth has rebounded and moved in a positive direction due to political stability, end of power crisis, 
expansion of the trade sector, acceleration of construction works, and increasing growth in industr ial 
output and the services' sector. As a result, the recent growth projection for Nepal by The World 
Bank and The Asian Development Bank stands around 6.5%. The fact that Nepal is likely to achieve 
over 6% of growth in three consecutive years proves the r esilience of the Nepali economy.  
2.10.   A full -blown economic and governance reform has started. The country's Constitution 
encourages foreign capital and technological investment as well as development of industries in WT/TPR/W/159  • Nepal  
 
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  areas of comparative and competitive advan tage. Several policies and laws have been put in place 
to ensure the implementation of the Constitution such as the Development Cooperation Policy 2014, 
the National Broadband Policy 2015, the Trade Policy 2015, the Foreign Investment Policy 2015, the 
Information and Communication Technology Policy 2015, the Special Economic Zone Act 2016, the 
Industrial Enterprises Act 2016, the Nepal Trade Integration Strategy 2016, the Public Procurement 
Act 2016, the Intellectual Property Policy 2017, the Labor Act 2017 , and the National Mineral Policy 
2017, among others.  
2.11.   Similarly, the Intellectual Property Rights Bill, the Anti -Dumping, Countervailing and 
Safeguard Bill, the Investment Board of Nepal Bill, the Agro -business Promotion Bill, the Foreign 
Investment and Technology Transfer Bill, the Export -Import Management Bill, the Competition 
Promotion and Market Protection Bill are in process.  
2.12.   Nepal has signed Bilateral Trade Agreements with seventeen countries so far. Also, it has 
been a party to the SAFTA and BIMSTE C regional trading arrangements. The country has signed the 
Bilateral Investment Promotion and Protection Agreement (BIPPA) with six countries and Double Tax 
Avoidance Agreement (DTAA) with ten countries. As an LDC, Nepal can enjoy duty free market 
access in many developed and developing countries.  
2.13.   However, these market access opportunities are yet to be fully realized by strengthening our 
supply side and productive capacity. Development is central to increasing our share of growth in 
global export trade fo r poverty reduction and sustainable development. Hence, we are looking for 
realization of increased FDI to boost production and productivity.  
2.14.   Foreign investments complement national capital formation. Various legal, institutional and 
procedural reforms ar e underway to create an investment friendly environment and contribute to 
easing the cost of doing business. The Government is strengthening the Investment Board as a 
one-roof institution to facilitate mega investments in various sectors, including public -private 
partnership -based projects.  
2.15.   To make Nepal an attractive destination of investment in South Asia, Nepal has taken 
significant strides in reforming its investment regime. Two high -level institutional mechanisms have 
been formed to facilitate FDI – the Investment Board, chaired by the Prime Minister and the 
Industrial Promotion Board, chaired by the Minister of Industry, Commerce and Supplies.  
2.16.   Nepal organized an Investment Summit in 2017 to promote FDI. The event was attended by 
more than 250 instituti onal and individual investors from 21 countries to express their intent in 
investment in various sectors of the economy. To further boost this initiative, the next Investment 
Summit is scheduled to be organized in March 2019. We are aiming at our comparati ve and 
competitive advantage in various sectors of trade and our opportunity for market access in the 
neighbourhood as well as the larger world.  
2.17.   The private sector, highly valued in Nepal as a key driver of economic growth, is expected to 
expand its role i n promoting a competitive economy. Following the adoption of liberal economic 
policies in the 1990s, the private sector's investment in the services' sector has taken off 
impressively.  
2.18.   Nepal's Industrial Policy aims to enhance export of industrial goods b y producing quality and 
competitive products, increasing the industrial sector's contribution to GDP. Moreover, one Special 
Economic zone (SEZ) and a number of industrial estates have already come into operation. Also, the 
Government has plans to set up ei ght more SEZs and industrial villages across the country. 
Furthermore, establishing cross -border economic zones is also in priority.  
2.19.   The Agriculture Development Strategy was brought with a vision for a self -reliant, sustainable, 
competitive, and inclusive agricultural sector that attributes economic growth and improves 
livelihoods and food security. Nepal's fabulous agro -climatic zones, rich biodiversity, water resources 
and ample supply of labour offer a comparative advantage in boosting agricultural produ ction.  
2.20.   Nepal's economy is mostly dependent on agriculture, but the sector's contribution to GDP is 
limited to 27% for 2017/18. In this backdrop, the Government has planned to double agricultural 
production in the next five years and shift a large populati on to off -farm and other emerging sectors.  WT/TPR/W/159  • Nepal  
 
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  2.21.   The services' sector, emerging as a vibrant part of the economy, contributes around 57% to 
GDP. Tourism, communication, IT/BPO, health, education and construction are major contributors. 
In the export, tourism an d IT/BPO hold a larger share. The tourism sector, in particular, has 
registered a growth in arrivals by 25% in 2017. In order to enhance the tourism sector's share in 
the economy, the year 2020 has been declared "Visit Nepal 2020" that targets welcoming tw o million 
tourists from around the world. I take this opportunity to invite everyone to Nepal.  
2.22.   As a landlocked country, improving connectivity in the neighbourhood and beyond is an 
imperative for Nepal for raising competitiveness and efficiency in trade.  
2.23.   In order to reduce Nepal's transit cost, Nepal and India have agreed to review the existing 
Transit Treaty, which is going to include for the first time in the history inland waterways in order to 
better link the country with sea. Similarly, both countries  are reviewing the existing Trade Treaty 
with the aim of balancing their bilateral trade.  
2.24.   Recently, Nepal and China have agreed to enhance connectivity with the overarching 
Framework of Trans -Himalayan Multi -Dimensional Connectivity Network. A landmark ne gotiation 
successfully concluded with China provides Nepal with transit to and from the sea via the territory 
of China in September 2018.  
2.25.   The Government has put forward plans to develop important national highways as express 
highways and East -West and Nort h-South roads of national importance. Foreign investment is open 
and welcome in the transport sector. Also, plans for railway connectivity to Kathmandu from both 
India and China are in progress.  
2.26.   Nepal's success in expanding access to ICT to a large section  of the population presents 
unparalleled opportunities for growth in the area of e -commerce. UNCTAD's e -Trade Readiness 
Assessment of Nepal commends our efforts to develop the capacity of youths in the IT sector. 
E-commerce is potential to bring down tradi tional socio -cultural, economic and geographical barriers 
and help integrate Nepal into the global market in the course of time. Formulation of a National 
Strategy for e -commerce is underway to enhance national capacity.  
2.27.   In recent years, the trade deficit has been growing in an unsustainable manner. The deficit is 
largely attributed to remittances -induced -consumption growth that remains in mismatch with 
internal production of goods. As a result, 2017/18 faced import to GDP ratio of 39.7%, export to 
GDP rati o of 2.6% and trade deficit to GDP ratio of 37.1%. To address the trade deficit, enhancing 
the supply -side capacity is the first and foremost challenge. Comprehensive and cross -cutting policy 
instruments that includes infrastructure, trade, monitory, indus trial, fiscal, revenue, agriculture, 
investment, competition, among others, are in active use to narrow down the trade deficit.   
2.28.   NTIS 2016 aims at enhancing Nepal's export competitiveness by addressing seven 
cross-cutting strategic issues: trade capacity,  the trade and investment environment, trade and 
transport facilitation, standards and technical regulations, SPS, intellectual property rights, and trade 
in services. These are integral parts of linking our trade to development.  
2.29.   Nepal is making significan t progress in the domain of the intellectual property (IP) rights 
regime. The IP Policy 2017 has a vision for developing Nepal as an innovative and creative nation 
through protection of Intellectual Properties. Now a new IP Bill is in progress.  
2.30.   Various cu stoms -related policies and institutional reforms have been carried out for trade 
facilitation. The Customs Reform and Modernization Strategies and Action Plan (CRMSAP) will be 
fully implemented by 2021. The Web -based ASYCUDA World system has been implement ed in 
15 customs offices, covering about 98% of total trade. Recently, The Government has moved ahead 
for implementation of a National Customs Single Window.  
2.31.   Nepal is yet to reap the benefits from international trade due to a number of impediments. 
The maj or includes high transit and transportation costs, low level of supply -side capacity, difficult 
terrain, insufficient production, heavy reliance on imports of consumable items and petroleum 
products, insufficient trade infrastructure, low value addition, e tc. WT/TPR/W/159  • Nepal  
 
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  2.32.   Nepal's political stability is an opportune time for high and sustainable economic growth. 
Political stability offers a springboard to leapfrog for socio -economic transformation. It also helps 
strengthen global partnerships that would lead Nepal to gra duate from the LDC status, and thereby 
to achieve Sustainable Development Goals (SDGs) and elevate to a middle -income country by 2030.  
2.33.   The leadership of the country has deeply realized that wider reach of socio -economic benefits 
for common citizens is a pr econdition to sustain the young republican and federal system. To let it 
happen, reform is high on the agenda of the present Government.  
2.34.   The reform that seizes investment opportunity; the reform that delivers in real terms to the 
common people; the reform  that ensures zero tolerance against corruption; the reform that 
integrates the country into the global market with dignity is the prime thrust of our agenda.  
2.35.   We hereby request all WTO Members and development partners to extend cooperation and 
support to u s in this time of need. We want to be mainstreamed in the global trade.  
2.36.   Finally, we once again wish to thank Members for the deep interest in the policy review process 
of Nepal. We look forward to a fruitful and constructive engagement ahead. Thank you for  your kind 
attention.  
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  3  STATEMENT BY THE DIS CUSSANT  
3.1.  I am pleased and privileged to be here today as the discussant for the second Trade Policy 
Review of Nepal.  
3.2.  I would like to warmly welcome the Nepali delegation from Kathmandu, led by Secretary 
Chandra Kumar Ghimire of Nepal's Ministry of Industry, Commerce and Supplies, together with their 
hard-working Geneva -based delegation headed by Ambassador Deepak Dhital.  
3.3.  I would also like to thank the WTO TPRD Secretariat headed by Director Willy Alfaro and the 
Government of Nepal for their comprehensive reports on which we will base our review over the 
next two days. I wish to note that Nepal has made use of the alternative timeline, which has further 
enhanced the transparency of this review process.  
3.4.  I would be dividing my intervention into three parts: first, I would talk about Nepal's general 
economic environment; second, I would touch upon some updates on Nepal's trade and investment 
policies and practices since its last review in 2012; and third, the challeng es and opportunities in 
Nepal's economic development.  
Economic environment  
3.5.  Despite two devastating earth quakes in 2015 and disruption of supplies at its southern border, 
Nepal's economic growth has rebounded and moved in positive directions due to politi cal stability, 
availability of energy, improvements in supplies, expansion of the trade sector, acceleration of 
construction work, and high growth in industrial output and services sector.  
3.6.  Nepal is steadily moving in the path of economic transformation. I t aims to be a middle -income 
country by 2030, which means it will need to reach an annual GDP growth of over 7%. Since its last 
Trade Policy Review in 2012, Nepal's economic growth has averaged 4.4% per year. The high 
economic growth rate of 7.4% in 2016 -2017 is expected by authorities to be sustained at 5.9% in 
2017-2018.  
3.7.  At the end of the last review period, the nominal per -capita GDP was only USD 702, and it is 
expected to now cross the thousand mark and reach USD 1,004 GDP per capita in FY 2017 -2018. 
With GDP per capita increasing impressively, this has progressed to reduce poverty from 25% in 
2011 to currently 21.6%. The Nepali Government projects that it will drop further to 17% in the 
next few years. Thus, this will greatly reduce the number of nearl y 6 million of Nepalis living in 
poverty.  
3.8.  Agriculture represents over one -quarter of its GDP and two -thirds of its employment. The 
contribution of manufacturing to GDP has steadily declined during the last decades to 5.4% in 
2017-2018. The services' sector , on the other hand, continues to be the largest contributor to GDP, 
with nearly a 60% share in 2017 -2018.  
3.9.  Nepal's current account surplus turned into a deficit in FY 2016 -2017 due primarily to increasing 
imports of goods and services, although the trade deficit was offset to some extent by strong 
remittances, which is about one -quarter of its GDP in FY 2017 -2018.  
Trade and investment policies and practices  
3.10.   Nepal became the first LDC to join the WTO through an accession process in 2004, which is a 
testament to its commitment to utilizing international trade to meet its sustainable development 
objectives. It actively participates in the WTO as an LDC and on behalf of the LDCs – through its 
roles as Coordinator of the LDC group in 2013 and during the Ministerial Conference in Bali. 
Currently, it is working as a focal point on Trade Facilitation within the LDC group.  
3.11.   It has ratified the Trade Facilitation Agreement and the protocol amending the TRIPS 
Agreement. It also made efforts to fulfil its notific ations obligations in the WTO, however, there are 
still outstanding notifications to be notified to the different committees.  WT/TPR/W/159  • Nepal  
 
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  3.12.   In terms of trade agreements, Nepal continues to participate in two overlapping regional 
agreements: the South Asia Free Trade Are a (SAFTA); and the Framework Agreement on the Bay 
of Bengal Initiative for Multi -Sectoral Technical and Economic Cooperation (BIMSTEC) FTA. In 
addition, Nepal has bilateral trade agreements with 17 countries.  
3.13.   Nepal is a landlocked country with only two nei ghbouring countries – India and China. Its 
merchandise trade is mostly with India, which comprises 65% of its imports and 57% of its exports 
in 2017.  
3.14.   Nearly all its tariffs are applied on an ad valorem basis, with 51 tariff lines subject to specific 
rates.  The simple average applied MFN tariff in FY 2018 -2019 was 12.0%, a slight decrease from 
12.2% in FY 2011 -2012. Average tariffs on agricultural products are higher than those on 
non-agricultural products, at the rate of 12.6% and 11.9%, respectively.  
3.15.   Nepal also bound all but 54 tariff lines at the HS eight -digit level. In general, its applied tariffs 
are much lower than bound rates with a 14.6 percentage point difference between the average MFN 
applied rate and the average bound rate. However, in FY 2018 -2019, out of a total of 5,572 tariff 
lines, the applied rates exceed the bound rates for 38 tariff lines. Our review process today and the 
next days can afford us the opportunity to clarify this limited number of lines leading to exceeding 
the bound rates.  
3.16.   In addition, a bound tariff line was subsequently separated into a number of separate tariff 
lines and some of these new tariff lines (eight in total) have applied tariffs in excess of the binding. 
There are also 12 tariff lines subject to specific duties which could exceed the bound ad valorem 
rates.  
3.17.   The amount of foreign direct investment (FDI) in Nepal is growing at a significant rate as it 
has increased three -fold from 17 billion NRs (Nepalese Rupees) in 2016 -2017 to 61 billion NRs in 
2017-2018. The in ward stock of foreign direct investment (FDI) represented 6.9% of GDP in 2017, 
still among the lowest in the region. In order to attract larger FDI inflows and improve the business 
climate, several measures have been implemented, the development of the For eign Investment 
Policy 2014, as well as new legislation, such as the Industrial Enterprise Act 2016, and the Labour 
Act 2017, as mentioned by our distinguished Minister.  
3.18.   A new Constitution in 2015, which replaced the Interim Constitution of 2007, and a ne w 
Government with a large majority in 2018 should create political stability, although the shift to a 
federal system of government means significant institutional changes and, at the federal level, the 
Government has also implemented changes to the number and authority of some ministries.  
3.19.   May I add my own congratulations to Nepal for the multi -year, multi -sector, consensus 
building efforts that yielded a three -level federal system and a new Constitution that hopes to 
respond to the people's aspiration for a  developed, prosperous and happy Nepal.  
3.20.   During the review period Nepal has taken several steps to improve the trading and business 
environment including ongoing programmes on import procedures and the electronic government 
procurement system. Various customs -related policies and institutional re forms have been carried 
out as well to facilitate trade, such as the 5th Customs Reform and Modernization Strategies and 
Action Plan (CRMSAP), the E -Customs Master Plan, and the Integrated Check Posts (ICPs) system.  
Challenges and opportunities  
3.21.   Nepal's mo st serious constraint is its geography. Trade and transit costs are higher as it is a 
landlocked country. The difficult geographic features of high mountains and hills add to the costs of 
developing infrastructure and doing business.  
3.22.   Supply -side capacity constraints as well as its trade deficit and the non -diversified nature of 
trade have remained key challenges for Nepal. In the last five years, the trade deficit has regrettably 
doubled, with the share of total exports in the GDP halved from about 10% to 5% in the past decade.  
3.23.   Increasing consumption patterns, low levels of production and productivity, heavy reliance on 
imports of raw materials and fuel, and exports of low value products, among others, are some of WT/TPR/W/159  • Nepal  
 
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  the key factors identified as contributing  to the ballooning trade deficit. Moreover, Nepal relies 
heavily on two major trading partners, India and China, and the trade deficits with both these 
countries have widened.  
3.24.   Nepal is yet to fully utilize its potential for exporting various products by m aking use of 
concessional market access provided by many of its trading partners such as GSP and DFQF 
initiatives because of requirements that need to be fulfilled as an exporting country, and partly due 
to supply -side constraints.  
3.25.   Nepal indeed needs sign ificant investments to overcoming trade -related infrastructure 
challenges to fully utilize its export potential and productive capacity. As a landlocked country, efforts 
in developing transport infrastructure, including railways, waterways, airports, expre ssways, tunnel 
ways, and cable cars and energy infrastructure are of vital importance. We are happy to note from 
the Government report and the distinguished Minister that infrastructure is a top priority for the 
Nepali Government.  
3.26.   Under its National Trans port Policy, Nepal reported its plan to invest over US$8 billion in road 
infrastructure, rail connectivity and transport sector management in the next five years. Road 
transport is the predominant mode of transport in Nepal, accounting for 90% of the movem ent of 
passengers and goods.  
3.27.   Nepal has indeed abundant untapped opportunities in its energy sector, especially in 
hydropower. The Government plans to produce 3000 megawatt (MW), 5000 MW and 15000 MW 
hydroelectricity within the next 3, 5 and 10 years, resp ectively, out of the economically feasible 
43,130 MW, through public and private investment in small, medium and large hydroelectricity 
projects.  
3.28.   With improved infrastructure and connectivity, tourism is another sector that could contribute 
greatly to Nep al's economic growth. Its exceptional natural beauty, biodiversity, and rich cultural 
heritage makes Nepal a preferred destination for many tourists from all over the world.  
3.29.   In order to harness all these opportunities, active collaboration with the privat e sector, policy 
reform especially on its Public -Private Partnership Law, improving project management, enhancing 
coordination among government agencies and stakeholders at the three federal levels, and 
unwavering support of its people and its neighbours w ill be essential.  
Conclusion  
3.30.   In conclusion, I do wish to commend the delegation of Nepal for the impressive performance 
of its economy despite the challenges encountered, and I do wish the Nepal a successful review 
process. I look forward to listening to M embers' statements and the exchange of views between the 
Government of Nepal and WTO Members. Thank you for your attention.  
  WT/TPR/W/159  • Nepal  
 
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  4  STATEMENTS BY MEMBER S 
KINGDOM  OF SAUDI  ARABIA  
4.1.  The Kingdom of Saudi Arabia commends Nepal for overcoming its daunting challenges an d 
keeping its economy open even in difficult times.  
4.2.  We also welcome the reforms undertaken by Nepal to improve customs procedures, develop 
foreign investment and industrial enterprises and Special Economic Zone. We believe that launching 
the 14th National Development Plan, the National Trade Integration Strategy  
4.3.  2016 and the Trade Policy 2015 will help Nepal to achieve its objective of being a middle -income 
country by 2030.  
4.4.  The Kingdom of Saudi Arabia and Nepal enjoy good bilateral cooperation at political and 
economic levels and enhance efforts to promote cooperation in trade and investment in the area of 
infrastructure, agriculture and tourism.  
4.5.  In conclusion, the Kingdom of Saudi Arabia trusts that the resilient economic policies and 
growth -enhancing refor ms adopted by Nepal will continue to support the improvement of its 
economic performance and its social and environmental development.  
4.6.  We wish a very successful Trade Policy Review for Nepal.  
JAPAN  
4.7.  We appreciate Nepal's efforts to answer our written questions, which included useful 
information in areas of interest to us such as intellectual property.  
4.8.  According to the Secretariat's report, Nepal's economy grew at an average GDP growth rate of 
4.4% during the review period. Significantly, it achieved a 7.5% growth rate in 2017. On the other 
hand, Nepal's economy was affected by natural disasters in 2015 and in 2018. As a country that is 
also struck by frequent natural disasters, Japan would like to express its sympathy to Nepal. We 
expect that Nepal will  overcome these difficulties and continue its steady growth, as over 7% of 
annual growth is required in order to achieve Nepal's objective of being a middle -income country by 
2030.  
4.9.  Nepal has improved its business climate to attract foreign direct investmen t (FDI) through the 
enactment of the Foreign Investment Policy in 2014, the Industrial Enterprise Act in 2016, and the 
Labour Act in 2017. As a result, FDI represented 6.9% of Nepal's GDP in 2017, although this is still 
among the lowest levels in the regio n. At the same time, as pointed out in the Secretariat's report, 
the Nepali market has the potential to attract more foreign investors. We expect Nepal to facilitate 
continuous efforts for realizing an investor -friendly environment. In this regard, we stro ngly 
encourage Nepal to make further efforts to meet WTO notification requirements, relating to areas 
such as subsidies and domestic support in order to enhance predictability and transparency of its 
market.  
4.10.   In addition, we appreciate Nepal's strategic eff orts to support manufacturing and export 
oriented industries, as well as to facilitate growth in the tourism sector. We expect these areas will 
be central to Nepal's further social and economic development.  
4.11.   In general, Nepal actively participates in the W TO. In 2013 it played the role of Coordinator 
of the LDC group. Furthermore, Nepal ratified the protocol amending the TRIPs on 11 March 2016 
and the Trade Facilitation Agreement on 24 January 2017. Having said that, Nepal is not a participant 
in the Inform ation Technology Agreement (ITA), nor a party to the Government Procurement 
Agreement (GPA). We expect Nepal to consider participation in these agreements in the future.  
4.12.   Besides its efforts in the WTO, we recognize that Nepal has been actively engaged in 
enhancing bilateral trade agreements. We truly appreciate such efforts of Nepal to further liberalize 
its economy.  WT/TPR/W/159  • Nepal  
 
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  4.13.   Nepal has set objectives to graduate from LDC status by 2020 and transfer to middle income 
country status by 2030. In this regard, we expect  Nepal to continue its efforts in trade policy as they 
will contribute to Nepal's sustainable development and to accomplishing these objectives.  
4.14.   Japan does also have some concerns with regard to Nepal's trade policies, especially on the 
protection of intel lectual property rights (IPR). Nepal's intellectual property rights -related laws and 
regulations may not be sufficient to protect IPR. We are afraid that insufficient protection of 
intellectual property rights might discourage foreign investors from invest ing in Nepal. We request 
Nepal to develop solid IPR systems including strengthening protection for well -known trademarks of 
foreign companies. According to the government report, Nepal released its first National Intellectual 
Property Policy in 2017. Japan  understands and appreciates Nepal's launch of the improvement of 
IPR-related laws and regulations in accordance with the Policy. We hope that Nepal will further 
develop its IPR systems and improve their transparency.  
4.15.   In conclusion, we are convinced that N epal can continue its development through further 
liberalization of its trade policies and improvement of its investment environment. We wish Nepal a 
successful and productive TPR and look forward to seeing Nepal accomplish its goal of graduating 
from LDC status by 2020.  
UNITED  STATES  
4.16.   The Secretariat and Government reports have helped outline Nepal's economic policies and 
highlight the impressive steps taken by Nepal to secure the benefits of an increasingly open trade 
and investment regime. The United Stat es recognizes that acceding to the WTO can pose particular 
challenges for LDCs, but Nepal has met those challenges and used the opportunity to enhance its 
economic climate. The United States commends Nepal's commitment to bring its trade and 
investment reg ime into compliance with WTO rules.  
4.17.   During its first TPR, Nepal was widely commended for the significant progress it made in 
implementing the obligations undertaken in its accession protocol and for enacting market -driven 
policies to spur economic growth.  Nepal should continue to be encouraged. During the period of 
review, Nepal announced policies to expand trade, investment, and economic growth, including, 
among others, the Trade Policy 2015, Foreign Investment Policy 2015, National Trade Integration 
Strategy 2016, and the National Intellectual Property Policy 2017. The United States would also like 
to commend Nepal for ratifying the Trade Facilitation Agreement and for taking actions to streamline 
customs procedures and adopt other trade facilitation meas ures. 
4.18.   Nepal has taken these positive steps in the face of serious difficulties, including the 
devastating earthquakes in 2015. This is a testament to Nepal's determination to overcome inherent 
geographic difficulties, such as being a landlocked country. Th e United States would like to 
congratulate Nepal for promulgating a new constitution in 2015 and successfully completing 
parliamentary elections in 2017. The current era of political stability presents an opportunity for 
Nepal to continue to reform its tra de policies and increase economic growth. We encourage Nepal to 
continue to make the most of trade and investment policy tools, enshrined in the framework of the 
WTO, to help improve the lives of its people and ensure a full economic recovery. We also enco urage 
Nepal to continue working with the Secretariat to meet its notification obligations.  
4.19.   The United States has a long history of economic engagement with Nepal, and we are 
particularly pleased to continue advancing that engagement through our Trade and I nvestment 
Framework Agreement with Nepal. This Agreement establishes an ongoing mechanism for us to 
discuss trade and investment issues of mutual interest and further strengthen the bilateral economic 
relationship. In 2016, the United States also implement ed a preference program that provides duty -
free treatment through 31 December 2025 for 77 types of products from Nepal, including certain 
carpets, headgear, shawls, and scarves. This programme is designed to improve Nepal's export 
competitiveness and suppo rt Nepal's economic recovery effort following the earthquakes. The 
United  States stands ready and committed to work with Nepal, bilaterally and with other Members 
through the WTO, to enhance Nepal's investment climate, TBT and SPS regimes, IPR protection, and 
other areas of trade policy to enhance Nepal's economic growth.  
4.20.   The United States offers our questions and comments on the Nepal trade regime in a 
constructive spirit, and we would like to thank the Nepalese delegation for considering and WT/TPR/W/159  • Nepal  
 
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  responding t o them. While we support Nepal's ongoing efforts to reform its trade policy regime, we 
also encourage Nepal to increase its efforts towards regulatory transparency and to make more 
extensive and effective use of WTO notification procedures.  
4.21.   In closing, th e United States appreciates this opportunity to participate in this discussion and 
looks forward to engaging with the delegation from Nepal and other members on its trade and 
investment regime. We commend Nepal's efforts to implement its WTO obligations an d thank Nepal 
for its answers to our written questions. We wish Nepal a successful review.  
CANADA  
4.22.   Since its first Trade Policy Review, Nepal has suffered a devastating series of earthquakes and 
aftershocks, which took over 9,000 lives and injured many thou sands more. Canada stood beside 
Nepal following the 2015 earthquake, establishing the Nepal Earthquake Relief Fund, through which 
Canada provided a total of $51.7 million in funding for humanitarian assistance and recovery efforts.  
4.23.   In light of the tremend ous challenge of reconstruction following the earthquake, which, in 
addition to the human devastation they wrought, also damaged critical trade -related infrastructure, 
Nepal has undergone a significant political transformation, including the promulgation o f its new 
Constitution in 2015. The Government of Nepal has also committed to structural transformation of 
Nepal's economy, with a focus on increasing production, generating employment and shifting 
towards an export -oriented economy. Canada is supporting N epal through innovative partnerships 
projects with civil society organizations and local governments across the country to help address 
the economic empowerment of women and girls, food security, community development, inclusive 
governance, improved educat ion, women and children's health, and environment and climate 
change. In 2016 -17, Canada disbursed close to $6 million through the Canadian Partnerships for 
Development Innovation programming in Nepal.  
4.24.   Nepal's trade volumes have more than doubled since 201 1, although its exports have 
increased at an average of only 0.5% per year over this same period. I applaud the steps Nepal has 
taken in order to improve its investment climate. The result has been a significant improvement in 
its World Bank Ease of Doing Business ranking, according to which Nepal is the fourth most open 
economy in South Asia.  
4.25.   I would like to take this opportunity to highlight some areas in particular where Nepal is 
making progress in the implementation of policies that promote growth and e conomic development:  
4.26.   First and foremost, we applaud the steps Nepal has taken in achieving political stability while 
at the same time recovering from its devastating natural disasters. This stability has led to stronger 
global partnerships, which should c ontribute significantly to Nepal achieving the Sustainable 
Development Goals. Nepal's new monetary policies – including simplifying the process of repatriating 
foreign investment earnings, establishing an exchange -rate hedging facility for foreign investor s and 
provisioning loan facilities for foreign investors – have served to create an investment -friendly 
business climate aimed at increasing trade, wages and the standard of living.  
4.27.   Second, we encourage Nepal to continue with its economic development plan under Trade 
Policy 2015, which focuses on strengthening supply -side capacity, increasing value -added exports 
of products and services, and increasing access to international goods, services and intellectual 
property. This plan aligns the various sectors of  Nepal's economy to enhance exports, and thus 
contributes to the strengthening of Nepal's economy.   
4.28.   Third, we applaud the achievements Nepal has made in the area of intellectual property rights, 
by including these rights in its Constitution and releasing the National Intellectual Property Policy in 
2017, aimed at creating a balanced IP system, a key element in attracting foreign investment.  
4.29.   Fourth, coming from an energy -exporting country, I applaud the development of Nepal's 
Transition System Master Plan announced in July of this year. The aim of developing close to 
7,000  kilometres of transmission lines across Nepal is a critical first step for Nepal in attaining energy 
self-sufficiency, and ultimately becoming an energy exporter in the region. Canada loo ks forwarding 
to supporting Nepal in this endeavour.  WT/TPR/W/159  • Nepal  
 
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  4.30.   Finally, I would like to congratulate Nepal on its continued involvement in the WTO. The 
mechanisms Nepal has put in place to support its WTO involvement are increasingly important as 
Nepal nears graduat ion to developing -country status.  
4.31.   Along with all of these promising initiatives and progress already made, there remain areas 
which would benefit from further attention on the part of Nepal's government. Ensuring fiscal 
discipline at all levels of governm ent is critical. Further reforms are also needed in order to reduce 
the cost of doing business, and thereby encourage foreign investment. Similarly, Canada encourages 
Nepal to increase the pace of its legal reforms, particularly in the area of trade and in vestment.  
4.32.   In addition, the Secretariat report indicates that Nepal has a number of outstanding 
notifications in relation to various WTO committees, but indicates that several notifications are in 
the "final stages of preparation". Notifications are key to  ensuring transparency and mutual 
understanding. Canada welcomes Nepal's recent efforts to fulfil its notification obligations, as 
outlined in the Secretariat report, and encourages Nepal to submit its outstanding notifications at 
its earliest convenience.  
4.33.   Canada also encourages Nepal to participate in Joint -Statement initiatives, such as on 
electronic commerce, investment facilitation, and MSMEs, as well as support the Joint Declaration 
on Trade and Women's Economic Empowerment.  
4.34.   In closing, we wish Nepal a  productive and useful second Trade Policy Review, and we look 
forward to a constructive exchange of views this week.  
ICELAND  
4.35.   As the WTO report notes, since the last review in 2012, economic growth has averaged 4.4% 
per year, despite Nepal being hit with t wo earthquakes in the fiscal year 2015 -2016 which caused 
considerable damage to infrastructure and production. It is also noteworthy that GDP per capita has 
risen over the review period, although poverty alleviation remains a major challenge. Iceland 
welco mes the steps Nepal has taken, since the last Trade Policy Review, to improve the trading and 
business environment, such as better customs procedures and plans for further improvement.  
4.36.   The report prepared by the Government of Nepal for this policy review points out the 
objectives of the Government of achieving high economic growth, balancing and strengthening the 
economy, and making it more inclusive and just, in the interest of all Nepali. The report also notes 
special efforts in the IT sector to enable S mall and Medium Enterprises in Nepal, especially owned 
by women and young entrepreneurs, to grow globally.  
4.37.   On the occasion of the 11th Ministerial Conference in Buenos Aires last December, more than 
120 WTO Members and Observers launched a joint declaratio n on trade and women's economic 
empowerment that aims, inter alia , at sharing best practices and working together here at the WTO 
to remove barriers for women's economic empowerment and increase their participation in trade. 
This declaration is the fruit o f the Trade Impact Group that was established under the auspices of 
the International Gender Champions –Geneva that Iceland is co -chairing.  
4.38.   The trade policy review provides an excellent opportunity to share best practices in this field. 
Iceland submitted a dvance written questions on the participation of women in the economy of Nepal, 
as well as on the initiatives mentioned earlier that Nepal is undertaking on making economic growth 
more inclusive. We wish to thank Nepal for the responses to our written ques tions. We will review 
the answers thoroughly and request clarifications as necessary during the course of this TPR. The 
answers are very useful as we implement the joint declaration on trade and women's economic 
empowerment and gather best practices.  
4.39.   Iceland appreciates Nepal's active engagement in WTO and their continued support for the 
multilateral trading system. We wish the delegation of Nepal every success for their second trade 
policy review.  
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  THAILAND  
4.40.   Nepal and Thailand have been bound by commonalit y of culture and shared values. The 
bilateral relations are marked by strong friendship, goodwill and understanding between the two 
countries. We are pleased to highlight that Nepal is Thailand's sixth largest trading partner in South 
Asian region. In 2017 , our bilateral trade reached USD 66.6 millions.  
4.41.   Thailand's major exports are electrical products, construction materials, clothing, transport 
and telecommunication products. Nepal's exports, though relatively small now, show some prospect 
for growth. Poss ible areas for further exploration can be hides and skin, Himalayan herbs and herbal 
products, handicrafts, garments, and jewellery.  
4.42.   Thailand congratulates Nepal on its solid average annual economic growth of 4.4% since 2012 
despite the devastating earthqu akes in 2015. We are deeply impressed by the fact that Nepal's 
economic growth has rebounded and moved in positive directions due to availability of energy, 
improvements in supplies, expansion of the trade sector, acceleration of construction work, and hig h 
growth in industrial output and services sector. In addition, since its last trade policy review in 2012, 
Nepal has continued to improve customs procedures by creating a web -based paperless system.  
4.43.   Thailand commends Nepal's active participation in the mu ltilateral trading system, including 
through its role as a Coordinator of the LDC group in the WTO in 2013 and during the Ministerial 
Conference in Bali. During the review period, Nepal ratified the Trade Facilitation Agreement and the 
protocol amending th e TRIPS Agreement. Nepal has made efforts to complete its notifications 
obligations to the WTO. Nonetheless, some notifications are still outstanding, including notifications 
on subsidies, domestic support for agriculture, services, customs valuation, and import licensing 
procedures. In this regard, we recognize difficulties faced by Nepal in fulfilling its notification 
requirements, and we hope that Nepal will be able to submit the outstanding notifications in the 
near future.  
4.44.   In this review, Thailand subm itted a set of questions, covering the policies and measures of 
our interests such as Nepal's regional and preferential agreements, mining and energy sectors, the 
development in tourism industry, agricultural policies, intellectual property rights, and mea sures to 
address cases when applied rates exceed bindings. We would like to thank Nepal for timely response 
to our questions and will study them in detail with great interest.  
4.45.   Let me conclude by expressing our appreciation to the delegation of Nepal in eve ry level, and 
we wish Nepal a very successful Trade Policy Review.  
EUROPEAN  UNION  
4.46.   The EU would like to highlight some of the positive developments that have taken place during 
this period under review.  
4.47.   The EU commends Nepal's strong commitment to the mult ilateral trading system and, as 
reflected by its accession to the WTO, its support for a rules -based system. We also commend its 
strong efforts to graduate from Least Developed Country (LDC) status by 2022.  
4.48.   Since its last TPR in 2012, Nepal has continued t o improve its customs procedures by 
implementing a series of Customs Reform and Modernization Strategies and Action Plans, and 
through an E -customs Master Plan which is intended to create a web -based paperless system of 
customs clearance.  
4.49.   Nepal has also im proved the business climate and made foreign direct investment inflows 
more attractive, through its Foreign Investment Policy in 2014, and by adopting new legislation such 
as the Industrial Enterprise Act in 2016, and the Labour Act in 2017.  
4.50.   The EU welcomes Nepal's ratification of the Trade Facilitation Agreement in 2017 and the 
notification of its Category A, B and C commitments under this Agreement. The EU also commends 
Nepal's ratification of the Protocol amending the TRIPS agreement in 2016. We c all on Nepal to 
consider joining the initiatives on electronic commerce, investment facilitation and MSMEs as well as 
the declaration on women and trade.  WT/TPR/W/159  • Nepal  
 
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  4.51.   Even though Nepal was hit very hard by the earthquakes in 2015, economic growth has 
averaged 4.4% per year since 2012. We notice that trade (exports and imports of goods and 
services) accounted for 52% of GDP in 2017 (compared to about 40% in 2012). Nepal is among 
South Asia's most competitive economies (the third after India and Bhutan). The service secto r has 
accounted for nearly 60% of GDP in 2017 -2018, with the tourist sector being of key importance to 
Nepal's social and economic development.  
4.52.   The EU has important relations with Nepal. The EU is Nepal's third trading partner, accounting 
for about 4% of Nepal's total trade in goods. Being a LDC, Nepal benefits from duty -free and quota -
free access to the EU market for all products (except arms and ammunition) under the "Everything 
But Arms (EBA)" arrangement in the context of the EU's unilateral Generalize d Scheme of 
Preferences (GSP).  
4.53.   Nepal and the EU, together with its Member States, are also important partners in 
development cooperation. In line with Nepal's development plan, cooperation focuses on support to 
a sustainable rural development (including n utrition), education and strengthening of democracy 
and decentralisation. Our multi -annual indicative programme for Nepal allocates €360 million in 
2014-2020.  
4.54.   The EU would also like to raise a few challenges, some related to the questions we addressed 
earlier. We appreciate Nepal using the alternative timelines that has allowed us to review the replies 
in advance of the meeting.  
4.55.   First, Nepal is one of the region's poorest countries, highly dependent on remittances. The EU 
supports Nepal's efforts in reduci ng poverty and improving overall living standards. Its National 
Development Plan aims to achieve socio -economic transformation by reducing poverty through 
employment -orientated economic growth, and also recognizes trade as an important factor towards 
achieving the objective of long -term inclusive and sustainable growth. This is also emphasized in the 
National Trade Integration Strategy (NTIS) 2016.  
4.56.   Second, we note that Nepal's export structure remains heavily concentrated on textiles, 
clothing and agricult ural products. We encourage Nepal to continue efforts to diversify its export 
basket and to modernise its traditional agrarian economy.  
4.57.   Finally, in the context of notification obligations to the WTO, the EU appreciates Nepal's efforts 
to improve transparen cy and encourages Nepal to notify the outstanding notifications.  
4.58.   On behalf of the EU, I look forward to a constructive exchange of views during this Trade 
Policy Review and wish Nepal's delegation the best of success.  
PHILIPPINES  
4.59.   The Philippines and Nepal enjoy 58 years of diplomatic ties. For nearly six decades, our 
countries have maintained friendly and mutually beneficial economic relations. Among the 
Philippines' top commodity exports to Nepal include millstones and fowls, while Philippine top imports 
from Nepal include buttons and cashmere.  
4.60.   Since its last Trade Policy Review in 2012, Nepal had undergone significant institutional 
changes culminating in the adoption of its new Constitution in 2015 and the shift to a federal system 
of government. The Phil ippines is confident that the Nepal government can overcome the initial 
difficulties and growing pains of this transition, so that the country can truly unlock its full economic 
potential.  
4.61.   The Philippines commends Nepal for its ambitious economic expansio n plans. The Nepali 
economy has proven to be quite resilient, growing at an average of 4.4% per year, even reaching 
7.4% in 2016 -2017, despite the economic impact of two devastating earthquakes that hit the 
country in 2015.  
4.62.   Nepal's growth potential is als o remarkable considering the structural limitations inherent in 
its being a landlocked country. Nepal has only two neighbouring countries — India and China — and WT/TPR/W/159  • Nepal  
 
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  majority of Nepal's merchandise trade is with India, which comprise 65% of its imports and 57%  of 
its exports in 2017.  
4.63.   We laud the Nepal Government's commitment to improve its physical and infrastructure 
connectivity through its National Transport Policy and through improved customs procedures and 
trade facilitation measures.  
4.64.   As the first LDC memb er to join the WTO through an accession process in 2004, Nepal has 
demonstrated its commitment to the multilateral trading system. We also recognize its active role 
in the WTO on behalf of the LDCs, particularly in its current role as the LDC Group's focal  point for 
Trade Facilitation.  
4.65.   The Philippines has submitted some written questions on the Nepal trade policy review 
Reports, and we kindly thank the delegation of Nepal in advance for their responses.  
4.66.   In closing, the Philippines looks forward to further  enhancing the mutually beneficial economic 
relations between our two countries through bilateral, regional, and multilateral fora.  
SINGAPORE  
4.67.   In 2017, bilateral trade between Singapore and Nepal grew by 30.9% year -on-year. However, 
there is clearly room fo r improvement as this growth comes from a relatively low base.  
4.68.   Nepal contends with particular challenges, as a land locked and least developed country, and 
one that is susceptible to natural disasters. The devastating earthquakes in 2015 took its toll on 
lives, infrastructure and production. We are happy that Nepal's economy has rebounded since then, 
and there has been strong growth in government revenues in recent years through strengthening 
tax administration. Nepal has taken commendable steps to improve its trading and business 
environment, including programmes on import procedures, an e -bidding system to make its 
government procurement system more transparent, as well as new customs procedures, such as an 
E-customs Master Plan.   
4.69.   We welcome Nepal's ratif ication of the Trade Facilitation Agreement and the Protocol 
amending the Agreement on Trade -Related Aspects of Intellectual Property Rights. Nepal may wish 
to consider becoming a party to the Information Technology Agreement, as this could have a positive  
bearing on Nepal's national efforts to improve its ICT infrastructure.  
4.70.   We note from the Secretariat's report that in FY 2018 -19, the applied rates for 38 of Nepal's 
tariff lines exceeded the bound rates. In a small number of cases, a bound tariff line wa s 
subsequently separated into a number of separate tariff lines, of which eight of these new lines bear 
applied tariffs in excess of the binding. We urge Nepal to abide by its WTO commitments and to 
rectify this situation soon.  
4.71.   We recognize Nepal's effort s to meet its WTO notification requirements. Nonetheless, we 
encourage Nepal to seek further technical assistance from the Secretariat and partners in order to 
fulfil its other outstanding notifications, including in the areas of subsidies, domestic suppor t for 
agriculture, services, customs valuation, and import licensing procedures. The WTO's monitoring 
function is a crucial aspect of the organisation, and Members' timely and complete notifications 
contribute to the predictability and transparency of the international trading system.  
4.72.   We appreciate Nepal's support for the rules -based, transparent and predictable Multilateral 
Trading System as stated in Nepal's government report. Despite the small size of the team at the 
Permanent Mission of Nepal in Geneva , ably led by Permanent Representative H.E. Mr. Deepak 
Dhital, Nepal participates actively in work at the WTO, especially in the advancement of the interests 
of LDCs. We wish Nepal every success in its second Trade Policy Review.  
CHINA  
4.73.   In the review period, the Nepali economy was severely hit by the earthquakes in 2015. 
However, we are very impressed by the great efforts of Nepal to recover from such shock and are 
pleased to see that Nepal's economy is rebounding. We appreciate Nepal's a mbition of being a WT/TPR/W/159  • Nepal  
 
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  middle -income country by 2030, and encourage Nepal to continue to take appropriate economic 
measures including open trade and investment policies to achieve more rapid growth and the 
sustainable development.  
4.74.   Multilaterally, Nepal is a st aunch supporter of the rules -based, transparent, and 
non-discriminatory multilateral trading system. It has been well recognized that Nepal is the first 
LDC to join the WTO following the full process of accession. We applaud Nepal's active participation 
in the WTO including through its role as Coordinator of the LDC group in the WTO in 2013 and during 
the Ministerial Conference in Bali. And now it is the focal point of LDCs on TFA. We welcome Nepal's 
ratification on the Trade Facilitation Agreement (TFA) an d the protocol amending the TRIPS 
agreement.  
4.75.   Bilaterally, China and Nepal are friendly neighbours linked by mountains and rivers, and enjoy 
the age -old history of bilateral relationship. China grants zero -tariff treatment to 97% of products 
originating fro m Nepal, covering 8030 tariff lines. China is Nepal's second largest trading partner. 
According to China's statistics, the two -side trade reached USD 990 million in 2017. Although it 
decreased about 50% compared with the year of 2012 due to the earthquakes  in 2015, a positive 
trend could be seen as the bilateral trade from 2016 to the first eight months of 2018 was keep 
increasing. In the meantime, China's investment in Nepal also increased. We expect that Nepal will 
further improve its trade and investment  environment to make it more attractive to the business 
people.  
4.76.   In early November this year, both the Nepal's Government and its business sector actively 
participated in the first China International Import Expo held in Shanghai. Well -known products of 
Nepal were exhibited in the Expo. The Nepalese participating enterprises regarded the Expo as a 
good opportunity to demonstrate their products and were looking forward to selling more to China.  
4.77.   Besides, China and Nepal are having very good cooperation under the Belt and Road Initiative 
and actions have already been taken. We believe such cooperation will not only benefit the two 
countries but also boost the economic growth in the region.  
4.78.   To conclude, I wish Nepal delegation every success in the second Review . 
INDIA  
4.79.   During the period under review, the economic growth of Nepal averaged 4.4% despite the 
blip in the GPD growth to 0.4% in 2015 -16 when the country was hit by devastating earthquakes. 
The GDP per capita of Nepal has also increased from USD 708 in 201 2-13 to USD 1004 in 2017 -18. 
Trade and investments are important for the Nepalese economy with export of goods and services 
amounting to 9% of the GDP. Travel, tourism, official development assistance and remittances are 
the other big contributors to the e conomy. However, Nepal also faces challenges which include 
addressing poverty, social and economic development issues, vulnerability to natural disasters, 
broadening the base of the economy and infrastructural development. We commend the Government 
of Nepa l for the efforts it is making to address the challenges including a trade integration strategy 
and other reforms and measures to promote growth and development. The new Constitution adopted 
in 2015 has a vision for socio -economic transformation, strengthe ning of institutions and prosperity 
of people.  
4.80.   India and Nepal share a special, close and friendly relationship with deep -rooted historic and 
cultural ties. We attach great importance to our multi -faceted relation with Nepal of which trade, 
investment and economic ties are an important component. There is a broad -based institutional 
framework in place to strengthen economic ties including the India -Nepal Treaty for promoting trade 
by providing preferential market access. Both countries also have a network o f multi -modal border 
connectivity including roads, rail links and trading points.  
4.81.   Our bilateral trade has been growing over the years and stood at USD 6.158 billion in 2017 -18. 
India is a source of over two -third trade for Nepal with a large range of goods  traded which include 
petroleum, steel, machinery, automobiles, chemicals, agricultural products, textiles and other goods. 
There is a large presence of Indian companies in Nepal which have invested in areas of 
manufacturing, power and the services sector such as banking, insurance, dry ports, education, WT/TPR/W/159  • Nepal  
 
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  tourism and telecommunications. In recent years, our cooperation in power sector has strengthened 
with investments from India in  
4.82.   the hydro -power sector, power transmission and grid connectivity. Both countr ies are also 
members of the Regional South Asian Free Trade Agreement and BIMSTEC and cooperate closely 
under these frameworks.  
4.83.   We also have a vibrant development partnership cooperation and India stands committed as 
a close partner to assist Nepal for its  socio-economic transformation and development goals. India 
is assisting Nepal in several development projects in the areas of infrastructure development, roads, 
rail links, strengthening border check -points, education, capacity building, agriculture and o ther 
areas. Several large, intermediate and small -scale development assistance projects have also been 
implemented in the past including for post -earthquake reconstruction and rehabilitation.  
4.84.   Chair, to conclude, given the depth and range of our relations w ith Nepal, India looks forward 
to working with the authorities of Nepal to further strengthen our ties including in the areas of trade 
and investment. We wish the delegation of Nepal a productive and successful TPR.  
SRI LANKA  
4.85.   During the review period from 2013 to 2017, we note that Nepal has made a moderate 
average progress of 4.4% despite the two earthquakes the country underwent in 2015 causing 
severe damages to the country and the economy. Although Nepal has very narrow merchandise 
export basket compared  to diversified import basket, Nepal has been able to maintain a current 
account surplus since 2002 except in few years. In this context, we believe that the recent trade 
deficit that Nepal is experiencing will be recovered very soon. It is evident that la ndlocked developing 
countries face number of obstacles in their efforts to integrate into world trade. Hence, it is our 
opinion that more focus on developing infrastructure that facilitates integration into world trade, 
would be a top priority for Nepal. I t will also facilitate attraction of foreign investments into the 
country.  
4.86.   My delegation notes with interest that Nepal has bilateral trade agreements with 17 countries 
in addition to the regional trade arrangements. Nepal's ratification of Trade Facilitat ion Agreement 
and due notification of category commitments reflect its commitment towards multilateral trading 
system. It is also interesting to note that since its last TPR, Nepal's customs procedures have 
continued to improve and has implemented E -custom s Master Plan and a Single Administrative 
Document in the Nepal Customs Automation System covering 95% of its trade.  
4.87.   It is noteworthy that the Government of Nepal has achieved a strong growth in Government 
revenue in recent years. We have noted that this a chievement has been made through strengthening 
tax administration, including the revenue generated at the border. A slight decline in applied tariff 
in 2018 -19 financial year is also noted. While there is a considerable water level between average 
applied and average bound tariff, we encourage Nepal to bring those tariff lines into conformity 
where applied rates exceed the its bound rates.  
4.88.   Let me briefly reflect on the bilateral trade and other economic, political and religious relations 
between two countri es. Although the two -way trade between two countries does not demonstrate a 
persistent pattern, we share similar difficulties when it comes to international trade. It is challenging 
for both the countries to diversify the export baskets that we could offer  to the world market. Sri 
Lanka's export to Nepal dominates by food preparations with a share of more than 50% in 2018. 
Being regional neighbours, both Sri Lanka and Nepal are members of the Regional Agreements, viz., 
South Asian Free Trade Area and the Ba y of Bengal Initiative for Multi -Sectoral Technical and 
Economic Cooperation (BIMSTEC) FTA.  
4.89.   Nepal and Sri Lanka as two friendly nations also share traditional cultural relations with each 
other marked by goodwill, mutual understanding and cooperation. Last  year the two friendly nations 
celebrated 60 -years of our diplomatic relations. The two countries share similar views on many 
international issues and work closely at various international forums including the UN and WTO, 
among others. At the invitation of  the President of Sri Lanka, His Excellency the President of Nepal 
visited Sri Lanka to attend the concluding ceremony of the International Vesak Day held in May 2017 
in Sri Lanka. During a State visit of our President to Nepal in 2009, there was an agreem ent on the WT/TPR/W/159  • Nepal  
 
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  establishment of a Joint Commission at the level of Foreign Ministers of both countries. The 
provisions of the Agreement include the cooperation in the areas of trade, finance, agriculture, 
industry and development of infrastructure, science and  technology, investment and other matters 
mutually agreed upon. Sri Lanka is also assisting Nepal in the reconstruction of several Buddhist 
temples that were damaged in the devastating earthquake in 2015. Sri Lanka also sent rescue teams 
and relief materia ls with immediate effect and participated in the International Conference on Nepal's 
Reconstruction.  
4.90.   In concluding, my delegation appreciates Nepal's valued contribution to the multilateral 
trading system and appreciate the role of Ambassador Deepak Dhital  and his team in Geneva. We 
sincerely wish the delegation of Nepal a successful conclusion at its second Trade Policy Review.  
MYANMAR  
4.91.   Myanmar reaffirms its strong supports to the WTO's TPR mechanism which aims at enhancing 
transparency and understanding of  the Member's trading system through regular monitoring 
approach.  
4.92.   Myanmar associates itself with the LDCs Group's statement delivered by the Central Africa. 
Bilateral relations between Myanmar and Nepal are based on goodwill, friendship and mutual 
understa nding. Myanmar and Nepal are members of the Bay of Bengal Initiative for Multi -Sectoral 
Technical and Economic Cooperation (BIMSTEC), housing over 1.5 billion people. The Memorandum 
of Understanding (MOU) on the establishment of Bilateral Consultation Mech anism between the two 
countries and the Agreement on exemption of visa Requirements for the holders of Diplomatic and 
Official Passports have been signed in July 2018.  
4.93.   According to our trade data, the bilateral trade between Myanmar and Nepal has increased , 
year on year. In the 2017 -2018 Fiscal Year, the trade turnover reached approximately USD 8 million. 
We hope that the level of trade between the two countries will be accelerated in future. In addition, 
the two countries have huge potentiality for exchang ing economic collaboration in tourism, culture 
and investment sectors.  
4.94.   Based on the Secretariat's report, I wish to draw your attention to the current trade regime 
of Nepal. During the review period, the average annual growth rate of Nepal was 4.4%. It has  
achieved strong growth in government revenues in recent years through strengthening tax 
administration.  
4.95.   According to the World Bank's Ease of Doing Business 2018 report, Nepal ranks 105th among 
190 economies and is the third most competitive economy in So uth Asia. We learned that Nepal is 
trying to be a middle -income country by 2030. Nepal has taken several steps to improve the trading 
and business environment during the review period.  
4.96.   The merchandise trade volume of Nepal was over USD 10.7 billion in 2017. Its export 
structure remains mainly concentrated in textiles, clothing, and agricultural products. In services 
trade, Nepal ranks 100th in the world for both export and import.  
4.97.   In terms of direct investment, Nepal's FDI inflows averaged USD 92 millio n per year during 
2012-2017. Nepal took measures to attract larger FDI and improve the business climate, including 
through the enactment of the Foreign Investment Policy 2014, the Industrial Enterprise Act 2016, 
and the Labour Act 2017.  
4.98.   Nepal has made effo rts at major transformations in institutional and regulatory reform 
initiatives. Its trade policy was updated in 2015 and the Nepal Trade Integration Strategy (NTIS) in 
2016. During the review period, it ratified the Trade Facilitation Agreement (TFA), and  the protocol 
amending the TRIPS agreement.  
4.99.   We are happy to note that Nepal strongly supports the WTO's Multilateral Trading System and 
it has been engaging actively in the WTO since its accession to the WTO in 2004. Nepal is actively 
working together with  the LDCs group at the WTO. Currently, Nepal is taking the role of focal point 
on Trade Facilitation within LDCs group as well as participating in various development activities for 
the LDCs, including Aid for Trade (Aff) initiatives.  WT/TPR/W/159  • Nepal  
 
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  4.100.   Finally, the delegati on of Myanmar is pleased to convey its appreciation to H.E. Mr. Chandra 
Kumar Ghimire and his delegation including the whole team in Geneva, for their constructive 
engagement throughout this TPR process.  
4.101.   My delegation wishes the delegation of Nepal every s uccess in their second Trade Policy 
Review.  
BRAZIL  
4.102.   Nepal, in the period analysed, has demonstrated significant growth in its economy and 
impressive resilience in its recovery from the 2015 earthquakes. In spite of the natural disasters, it 
has maintained s ignificant political and economic stability in the recent years and is set to have high 
levels of sustained growth in the near future on its way to development.  
4.103.   A Member of the WTO since 2004, Nepal has ratified the Trade Facilitation Agreement and 
the TRI PS Protocol, but still is lacking in notifications for various committees.  
4.104.   The country's trade is still very concentrated with its neighbours India and China as well as 
the European Union, with exports mainly concentrating in textiles and agricultural prod ucts, with a 
varied pool of imports. Having bound most tariff lines, as a developing country, Nepal has had low 
applied tariffs of around 12% in the period.  
4.105.   In this context of the resilience of the Nepalese people and the gradual opening of its 
economy, Br azil sees much potential for its bilateral relationship with Nepal to flourish in the coming 
years. Bilateral trade stands at USD 3 million and can be significantly expanded. The Nepal -Brazil 
Chamber of Commerce and Industry, established in 2015, has promo ted exchange between 
businesses of both countries in the areas of machinery and tourism. We hope these contacts help to 
foster trade and deepen economic ties.  
4.106.   Nevertheless, Brazil would like to express concern on certain quantitative restrictions 
recently imposed on sugar, adversely affecting consumers and effectively halting Brazilian sugar 
exports to Nepal. Brazil hopes these restrictions will be eased and trade in this sector will be restored.  
4.107.   Worthy of note was the recent demonstration of Embraer's 190 E-2 organized by Nepal's 
"Buddha Air". Brazil's regional jets are a great fit for Nepal's blooming tourism industry.  
4.108.   Let me conclude by wishing the delegation of Nepal a successful conclusion of this Trade 
Policy Review.  
LESOTHO  
4.109.   We acknowledge the robust m easures that Nepal has taken since the last Review. These 
measures include amongst others, trade -related legislations and regulations in the crucial areas of 
intellectual property rights, investment, customs procedures. In this regard we note with satisfac tion 
that the economy of Nepal has been steadily growing at an average rate of 4.4% and more 
importantly despite the devastating earthquakes in 2015 and its aftermath, the economy has 
rebounded and moved in positive directions.  
4.110.   At the multilateral level, w e wish to commend Nepal for its commitment to the rules -based 
multilateral trading system. We note with satisfaction that Nepal ratified the protocol amending the 
TRIPS agreement and has not only ratified the WTO Trade Facilitation Agreement but has notifi ed 
its Category A, B and C commitments under the TFA. Nepal has also stepped up its efforts in 
improving and simplifying the custom procedures and harmonizing them with international 
standards. We therefore acknowledge the implementation of the E -customs M aster Plan, which is 
aimed at initiating a paperless system of customs clearance. We also appreciate that in the period 
under review Nepal developed Nepal National Single Window (NNSW), which should be implemented 
by 2019.  
4.111.   Despite the successes which Nepal  has achieved in its trade policies, we are cognizant of the 
enormous challenges which Nepal continues to grapple with like other LDCs and LLDCs. The country 
remains vulnerable to exogenous shocks, for instance, the country's economic performance in 2015 WT/TPR/W/159  • Nepal  
 
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  decelerated in great measure due to the devastating earth quake, trade disruptions that led to 
shortages of fuel and other essential goods, and lower -than-expected remittances. Strengthening 
and accelerating international support measures to Nepal therefore  remains a cardinal issue. Like 
other LDCs, Nepal is eligible to benefit from unilateral preferences offered by various WTO Members 
but has not been able to meaningfully benefit from these preferences.  
4.112.   In this regard we wish to echo Nepal's clarion call fo r more support in the areas that have 
been identified.  
4.113.   Finally, my delegation wishes the Government of Nepal a successful Trade Policy Review.  
REPUBLIC  OF KOREA  
4.114.   Korea and Nepal have a long history of bilateral economic relationship. Korean companies 
and bu siness people have been the leading foreign investors in Nepal. Korea hopes that its economic 
partnership with Nepal will continue to grow and develop in the future. Turning to the overall 
performance of Nepal's economy, I wish to note that, as the Secreta riat Report mentioned, it has 
successfully overcome the aftermath of the previous earthquake and has kept growing.  
4.115.   After the resolution of its internal conflict, Nepal has become more attractive to foreign 
investors. The Nepalese Government also recognizes  the importance of FDI. In this context, Korea 
would like to advise Nepal to create a better investment environment which can be achieved by 
eliminating or modifying potentially investment -restrict policies and legal measures.  
4.116.   As of now, the procedures for  starting a business and obtaining a working visa are very 
complicated and time -consuming. To elaborate, starting a business in Nepal requires a seven -step 
procedure; moreover, acquiring a non -tourist visa after business incorporation takes even longer 
because of the bureaucratic red tape. In fact, Korean investors complained that it took at least 
thirteen weeks to get a non -tourist visa.  
4.117.   We are aware of the official one -stop service at the Investment Board Nepal (IBN), but we 
feel uncertain about the effec tiveness. Investors must visit four government agencies, namely the 
Department of Industry, the Department of Labor, the Ministry of Home Affairs and the Department 
of Immigration. Currently, investors need to obtain approval from each agency, separately.  
4.118.   Considering such a situation, we suggest the Government of Nepal to run a practical one -stop 
service for foreign investors, with its personnel composed of officials from related government 
agencies and workers from commercial banks, to facilitate FDI in N epal.  
4.119.   There is another instance related to FDI. Since 2011, a Korean electric company, Korea 
South -East Power Corporation, has been building a consortium in Nepal with other Korean 
construction companies and the International Financial Corporation to develop a 2 16MW Upper 
Trishuli -1 Hydropower Project.  
4.120.   Nepal Electricity Authority (NEA) has signed a Power Purchase Agreement (PPA) with the 
Korean developer and agreed to pay the tariff of the loan portion in U.S. dollar for ten years. Any 
foreign exchange losses of  NEA due to the payment of tariff in foreign currency shall be covered by 
the hedging fund created by the Government of Nepal. Hedging cost or premium for the hedge fund 
shall be borne by the Government of Nepal, NEA, and the developers appropriately.  
4.121.   Nevertheless, negotiations between NEA and the Korean developer are underway on how to 
share the hedging cost or premium. NEA is asking the developer to bear about USD 30 to 
USD 50 million as a hedging premium. Due to this huge burden, financial closure of the  project is 
getting delayed.  
4.122.   FDI projects contribute only 0.4% of Nepal's national GDP, which is much lower than other 
developing countries whose average is 2.4%. We believe Nepal needs to establish an FDI -friendly 
hedge -fund mechanism in order to attract  more FDI in the infrastructural and hydroelectric sectors.  
4.123.   It is also our hope that Nepal will continue to actively participate in helping strengthen the 
WTO multilateral trading system, guided by its long -term goal, "Prosperous Nepal, Happy Nepali" WT/TPR/W/159  • Nepal  
 
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  which includes many key elements for economic growth and trade promotion. With this, I would like 
to conclude by expressing my sincere appreciation to the Nepalese delegation for its hard work and 
wish Nepal every success in its second TPR.  
ARGENTINA  
4.124.   La Argent ina observa con gran interés que, desde el último examen de las políticas 
comerciales de Nepal realizado en 2012 su crecimiento económico ha alcanzado una tasa media 
anual del 4,4%. Sus ingresos públicos han crecido de manera significativa mediante el 
fortalecimiento de la administración tributaria, en particular en las aduanas; y el Gobierno está 
elaborando un nuevo código tributario único a fin de mejorar, consolidar y armonizar los principales 
impuestos internos.  
4.125.   El comercio bilateral entre nuestros país es fue de 5 millones de dólares EE.UU. en 2017. En 
2015, alcanzó su pico anual con un total de 6,9 millones de dólares EE.UU. Los principales productos 
de exportación argentinos a Nepal son el maíz, las semillas de nabo o colza y los porotos secos 
desvaina dos. De Nepal importamos esencialmente bienes de consumo, entre los que se destacan 
los de indumentaria.  
4.126.   La Argentina saluda las acciones emprendidas por el Gobierno nepalés orientadas a atraer 
Inversión Extranjera Directa (IED) y fortalecer el entorno emp resarial. Son de destacar la mejora de 
los procedimientos aduaneros y la elaboración de la Política de Inversión Extranjera de 2014, las 
Leyes de Empresas Industriales y de la Autoridad de las Zonas Económicas Especiales de 2016, y la 
Ley del Trabajo de 20 17. Es notable, asimismo, que en general Nepal no aplica restricciones a la 
inversión extranjera, salvo en lo que atañe a una lista negativa de un puñado de actividades.  
4.127.   Quisiéramos destacar especialmente que, desde el último Examen de las políticas 
comerc iales, los procedimientos aduaneros han seguido mejorando. Actualmente, Nepal está 
aplicando la quinta de una serie de Estrategias y Planes de Acción para la Reforma y Modernización 
de Aduanas, además de un Plan Maestro de Aduana Electrónica destinado a cr ear un sistema 
informatizado de despacho de aduana en línea.  
4.128.   Esperamos que el Decimocuarto Plan Nacional de Desarrollo y la Política Comercial de 2015 
aumenten el acceso a los mercados regionales y mundiales para las mercancías y los servicios 
nepaleses. N otamos con beneplácito, en tal sentido, que Nepal participa en dos acuerdos regionales 
y mantiene acuerdos comerciales bilaterales con 17 países; además de haber ratificado el Acuerdo 
sobre Facilitación del Comercio y el Protocolo por el que se enmienda el  Acuerdo sobre los ADPIC.  
4.129.   No quisiéramos dejar de mencionar que nuestro país sigue con atención la aplicación de 
aranceles elevados sobre algunos productos de las industrias alimentarias y el material de 
transporte, como así también el hecho de que Nepal continúe teniendo notificaciones pendientes 
desde los años 2011 -2012 en materia de ayuda interna a la agricultura.  
4.130.   Finalizando, y al tiempo de reiterar nuestro reconocimiento por esta nueva oportunidad de 
intercambiar elementos de juicio y consideraciones sobre las políticas y prácticas comerciales de 
Nepal, permítanos señalar, una vez más, la relevancia de este ejercicio de transparencia en todos 
sus aspectos y desear a las autoridades nepalesas la exitosa conclusión del presente examen.  
RÉPUBLIQUE  CENTRAF RICAINE  AU NOM  DU GROUPE  DES  PMA 
4.131.   Nous félicitons le Népal pour les initiatives multiples entreprises dans le cadre des activités 
menées à l'OMC depuis son accession et pour avoir toujours été un défenseur très actif des intérêts 
du Groupe des PMA. Le Népal  considère un système commercial multilatéral basé sur des règles 
comme étant une source positive d'une meilleure intégration au commerce et à l'économie mondiale. 
C'est dans cet esprit que le Népal élabore ses plans de développement.  
4.132.   L'économie du Népal a  connue des améliorations grâce notamment à sa capacité à saisir les 
bénéfices issus du commerce. Son taux de croissance économique a progressé en moyenne de 4,4% 
durant la période d'examen. Malgré les nombreux dommages causés par les importants 
tremblemen ts de terre de 2015, et du fait des efforts accomplis par le Gouvernement, l'économie WT/TPR/W/159  • Nepal  
 
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  du Népal s'est montrée résiliente — le taux de croissance de l'économie avait même atteint les 7,4% 
en 2016/2017.  
4.133.   Il apparaît que le Gouvernement du Népal a pris des mesu res significatives pour améliorer 
son climat politique, en promulguant une nouvelle constitution en 2015, qui définit les bases de la 
transformation économique du pays. Il faut compter, parmi les initiatives, l'amélioration et 
l'harmonisation des taxes int érieures, l'accès aux infrastructures, au commerce électronique, et la 
Loi de 2016 sur les entreprises industrielles se rapportant à l'amélioration des investissements 
directs étrangers. De plus, le Gouvernement a mis à jour sa stratégie d'intégration du c ommerce 
nationale, dans le but de favoriser l'aboutissement des Objectifs de développement durable.  
4.134.   Le Népal projette de devenir un pays à revenu intermédiaire d'ici 2030 et quitter par 
conséquent le statut de PMA. Toutefois, il demeure des défis à releve r pour atteindre l'objectif, sans 
compter que les efforts collectifs ne doivent pas être épargnés pour aider le Népal à améliorer son 
climat des affaires. De ce fait, le Népal aura besoin de l'appui de l'OMC et de ses Membres dans le 
cadre de la phase de s ortie du statut de PMA — ce qui inclut des flexibilités et des périodes de 
transition adéquates, afin que le pays s'adapte au mieux à la dynamique de mise en œuvre des 
Accords de l'OMC par les non -PMA.  
4.135.   Parmi les autres préoccupations majeures du Népal fig urent les coûts de transport, le déficit 
d'infrastructures et la vulnérabilité aux catastrophes naturelles, difficiles à surmonter, et ce même 
si le pays quitte son statut de PMA. En tant que PMA n'ayant pas accès à la mer, nombreuses sont 
les contraintes géographiques existantes de nature à perturber les échanges. Il est ainsi important 
de poursuivre le soutien et l'amélioration des programmes d'assistance existants, tels que l'Aide 
pour le commerce et le Cadre intégré renforcé.  
4.136.   Le Groupe des PMA appelle l es pays développés — dans le cadre de cet Examen — à être 
sensible aux besoins identifiés par le Népal en tant que PMA en matière d'assistance technique et de 
renforcement des capacités, et notamment à l'égard des domaines où il peut exister des difficulté s 
de mise en conformité avec les obligations de l'OMC.  
4.137.   Au nom du Groupe des PMA, la République centrafricaine félicite le Népal pour ses 
accomplissements en vue d'une meilleure intégration au commerce multilatéral et lui souhaite un 
plein succès de ses réf ormes et de son Examen des politiques commerciales.  
PAKISTAN  
4.138.   Pakistan and Nepal have strong regional ties through the SAARC (South Asian Association 
of Regional Cooperation) and we cooperate in a wide range of areas including investment, banking, 
human res ource development and regional trade development. Both Pakistan and Nepal are 
members of the South Asian Free Trade Area (SAFTA). Bilateral trade between Pakistan and Nepal 
currently stands at around USD 4 million with the balance in favour of Pakistan.  
4.139.   It is heartening to learn that Nepal's economy has shown consistent growth at an average 
of 4.4% during the review period, particularly a high rate of 7.4% in 2016/17, demonstrating a 
strong recovery after the devastating earthquakes in 2015 -16.  
4.140.   Nepal's ec onomy relies largely on the services sector contributing around 60% of the GDP. 
Tourism and its allied sectors remain one of the most important sources of revenue and economic 
activity for the country. The number of tourists grew at 40% and 25% in 2016 and  2017, 
respectively. The initiatives of creating new airports and expanding old ones are likely to give a great 
boost to the number of tourists to Nepal. Foreign remittances are also another major source of 
income, the flows of which have remained stable t hroughout the review period.  
4.141.   The Government of Nepal has undertaken extensive reform in its investment regime in order 
to attract domestic and foreign capital. Nepal offers one of the lowest rates of Corporate Tax and 
has signed Bilateral Investment Promot ion and Protection Agreement (BIPPA) with six countries and 
Double Tax Avoidance Agreement (DTAA) with ten countries, including with Pakistan.  
4.142.   The trends in the growth of industrial production also appear promising with 9.7% growth 
recorded in Financial Year 2016/17. This is likely to be boosted by the government's creation of WT/TPR/W/159  • Nepal  
 
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  industrial estates and Special Economic Zones (SEZs) and through the I ndustrial Enterprises Act of 
2016.  
4.143.   Pakistan continues to cooperate with Nepal through economic, regional and cultural ties and 
collaborates closely at the WTO on various issues of mutual interest. We wish to highlight the positive 
involvement of the deleg ation of Nepal at the WTO under the guidance of Ambassador Mr. Deepak 
Dhital and his team in Geneva.  
4.144.   We wish Nepal a very successful and fruitful TPR.  
TURKEY  
4.145.   Despite interrupted by 2015 earthquakes and the persistent macroeconomic challenges, 
average annu al growth rate of Nepal is quite strong. We also observe that strong activity in 
construction sector fuelled private investment which has become a key driver of growth.  
4.146.   As both secretariat and Government report underlined, agriculture, hydro -power, tourism  
and handicraft sectors provide ample opportunities for Nepal's economy. This potential offers a 
strong basis to ensure sustainable economic growth in the country, although there are major 
challenges impeding this potential.  
4.147.   Addressing these challenges, w e see there is strong need for crafting creative policies for 
the development of productive capacities, to enhance participation in international trade and to 
achieve poverty reduction and improvements in human capacity.  
4.148.   Through new Constitution in 2015 a nd recent action plans in the economy, Nepal has now 
been guided by structural reforms, which we also believe vital for sustaining economic growth and 
achieving a diverse manufacturing industry.  
4.149.   Nepal's recent policies to reform its tax system and to ease  customs procedures is also 
another positive step. In addition to its ratification of Trade Facilitation Agreement, the development 
of the Nepal National Single Window for 2019 will be another stepping stone in this regard.  
4.150.   Turkey has a good political and economic relations with Nepal. Turkey has become an 
important market for Nepali handicraft, especially carpets, in recent years. From 2013, Turkish 
Airlines has been operating direct flights between Kathmandu and Istanbul which also helps to 
promote touris m in Nepal from Turkey and other European countries. Turkey gives importance to 
the economic development of Nepal, and will continue to support Nepal's efforts towards expanding 
its presence in international trade and integration into the global economy. W e look forward to 
developing our cooperation with Nepal, both in bilateral and multilateral platforms.  
4.151.   We wish Nepal a very successful Trade Policy Review.  
UGANDA   
4.152.   Despite natural and socio -political challenges, Nepal has worked very hard to forge ahead 
with its economic development. Nepal has been a very active Member of the multilateral trading 
system. For example, we are all aware of Nepal's effective coordination of the LDC Group in 2013 
leading to the Group's effective participation in the formulation of the Trade Facilitation Agreement. 
Nepal has never relented in the shaping and putting forwards the LDCs' interests.  
4.153.   The country has made progress towards sustainable economic growth and opened the 
country to economic liberalization, leading to improveme nt in the living standards of its people with 
the GDP per capita at USD 989 and a growth rate of about 4.5%.  
4.154.   Nepal depends on export trade, the major export partners being India and the United States. 
It would be of interest to note that the export value f or Nepal amounts to USD 1.2 billion but the 
import value to Nepal from the import partners is valued at USD 7.2 billion, giving a huge deficit for 
the country. The imports are mainly from India and China. The two partners should do something 
to balance, to  improve, this relationship so that Nepal should get something more than it is getting 
now from the trade with them. Because of that, foreign aid to Nepal accounts for more than half the WT/TPR/W/159  • Nepal  
 
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  development budget, which means each 5 -year plan of Nepal depends hea vily on foreign assistance 
in the forms of grants and loans. Nevertheless, my delegation wishes to express its appreciation for 
the effective role played by Nepal's Ambassador here at the WTO arena.  
4.155.   I wish Nepal a successful Trade Policy Review.  
MOZAMBIQUE  
4.156.   Mozambique though being an African country, has something in common with Nepal. Both 
are LDC countries, and, though physically distant from each other, both face some common 
challenges, including the Natural disasters that sometimes face our countries bri nging reversals into 
the development stages.  
4.157.   My delegation commends the government of Nepal, for this second Trade Policy Review, and 
at the same time, progress gradually being achieved so far in the various domains of activities.  
4.158.   The steps taken by the Go vernment aiming at improving the political climate by among other 
initiatives aim at achieving the Sustainable Development Goals.  
4.159.   Given its condition of being an LDC, Nepal seeks be assisted in multiple ways.  
4.160.   We urge developed and developing country Member s to consider efforts aiming at providing 
more assistance to Nepal in view to build capacity in the different domains of concern, so that this 
sister country can be able to cope with its obligations as Member of the WTO, and also be able to 
foster its econ omic development.  
4.161.   My delegation would like to conclude by commending Nepal for all the efforts devoted in 
view of a more growth and prosperity.  
4.162.   We wish Nepal a successful Trade Policy Review.  
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  5  REPLIES BY THE REPRE SENTATIVE OF NEPAL A ND ADDITIONAL COMMEN TS 
5.1.  At the outset, my delegation would like to express sincere gratitude to Mr. Chair for your 
encouraging opening remarks delivered during the first session. You have made insightful comments 
on Nepal's trade issues.  
5.2.  Similarly, we highly appreciate Excellenc y Ambassador Mr. Teehankee for your insightful and 
substantive comments shared on the first day as a discussant. The observations and comments 
shared by you on our trade and economic development aspects are acknowledged with high 
appreciation as inputs for  further improvement.  
5.3.  Also, we would like to extend our sincere thanks to Excellency Ambassadors and distinguished 
delegates for your interest and active participation in our second Trade Policy Review.  
5.4.  22 Members delivered the statement at the first ses sion on 3 December. We are highly 
encouraged by Members' constructive engagements. I can assure you that we will take a look at all 
views and comments as feedback to devise strategy for the future. Moreover, I would also like to 
express our appreciation to  Members' acknowledgement of Nepal's efforts in economic liberalization 
and active participation in the multilateral trading system, including LDCs related concerns.  
5.5.  During your remarks on the first day, while explaining TPR you have very correctly used th e 
phrase "transparency exercises". Although Nepal is at a lower level of the ladder in development, 
we have internalized the TPR exactly in the same spirit.  
5.6.  Let me recall the important remarks and observations made by the distinguished delegates. 
Most dele gates appreciated Nepal's economic growth and resilience despite the devastating 
earthquakes of 2015, efforts and achievements in liberalizing trade and investment regime, 
reforming and modernizing customs, streamlining the process to attract the FDI, trad e facilitation 
initiatives, active participation at the WTO specifically at the LDC Group, among others.  
5.7.  We also noted that many delegates underlined the need to enhance supply -side capacity 
including productive capacity, trade related infrastructure, str engthening the institutional capacity, 
further reforming investment regime, etc.  
5.8.  Let me clarify some of the issues and comments raised in the first day.  
5.9.  Nepal has created dedicated institutions such as Nepal Investment Board for mega 
investments, Special  Economic Zones for export -oriented industries and one -stop services to 
facilitate the FDI. The FDI in Nepal is facilitated by the Foreign Investment and Technology Transfer 
Act, Industrial Enterprises Act and Investment Board Act.  
5.10.   Over the recent years, t he doing business and investment climate is getting continuously 
better due to political stability; business friendly policy regimes including tax exemption and 
improved governance with increased use of online services; smooth supply of power; improved 
industrial relations; enhanced rate of return; increased earning of people; raised consumption 
pattern, better educated and ICT -savvy young generation, cheap labour, greater preferential market 
access in developed countries, among others. Furthermore, the Gov ernment has strengthened the 
oversight mechanisms taking stern actions, if rent seeking and malpractices found. These initiatives 
have positively contributed in easing the doing business in some parameters, as mentioned in Doing 
Business Report 2019.  
5.11.   Nepal  needs about USD 15 billion per annum to achieve 8% of GDP growth, hence, investment 
from the private sector is a main priority. Accordingly, the Government is actively engaged in making 
the existing investment climate more competitive.  
5.12.   Compared to develo ped and many developing countries, Nepal is a at a lower rung of the 
development ladder. Having gone through political transition till recent times, we struggled to 
balance between two critical areas: first, managing the transition, and second, sustaining the 
macroeconomic stability. Nonetheless, we reaffirm that Nepal is fully committed to the multilateral 
trading arrangement, and abides by its rules.  WT/TPR/W/159  • Nepal  
 
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  5.13.   As we all know, Nepal bound almost 100% of its tariff lines when it acceded to WTO. We made 
extensive com mitments under the GATS. Many observers do note that Nepal made quite a 
remarkable set of commitments despite its LDC status.  
5.14.   Furthermore, on the almost 100% bound tariff lines, the bound rate averages 26.6%, whereas 
the applied rate averages far below th an the bound rate i.e. 12%, which is more than 100% lower 
than the average bound rate. That proves we have a huge number of products with least bound 
rates. These illustrates our strong commitments to rationalizing tariffs.  
5.15.   Nepal has been a most liberalize d economy since the 1980s. It has already opened up 
11 sectors and 70 sub -sectors for service trade. The country has carried on a negative list with a 
very small number, including in the services sector, through the Foreign Investment and Technology 
Transf er Act (FITTA), 1992. As a matter of fact, following Nepal's accession to WTO, the FITTA was 
amended to comply our services schedules. Except the negative list of FITTA, all sectors and 
subsectors are open to FDI. The allowed list for FDI is greater than o ur commitment to WTO. 
Furthermore, Nepal has been a founding party to SAARC Agreement on Trade in Services (SATIS), 
which came into effect since 2006. The Agreement too has further liberalized our services sector in 
the SAARC region.  
5.16.   Nepal believes that wi thout bringing the remaining DDA issues to a logical conclusion, it is not 
appropriate to run into new issues like e -commerce, MSMES, investment facilitation, etc. They might 
further erode our policy spaces and level playing fields. Also, they might add di fficulty in our 
integration into the MTS. Furthermore, Nepal is of the opinion that we should remain open to 
discussion on these issues in proper formats and under given mandates in an inclusive and 
transparent manner. Yet, we should acknowledge the fact t hat we are at varying ladder of 
development. The uneven level of country capacity impedes countries like ours on the road unless 
they are properly addressed. Thus, we need a certain time so as to enhance our country capacity 
before we enter into the course  for rule making negotiations.  
5.17.   On the whole, we look forward to getting constructively engaged together with all of you in 
advancing our common agenda. It would be better to tackle pending business and progressively 
move to new modern economic trade issue s in a linear sequence as a key to ensure the relevance 
of WTO.  
5.18.   The public procurement system of Nepal is governed by the Public Procurement Act, 2007 and 
Regulations, 2008 which ensure competition, transparency, good governance and predictability. The 
e-bidding is now compulsory for contracts of NR 5 million or above.  
5.19.   Similarly, Nepal is potential in IT/BPO. Hence, the IT sector is on high priority.  
5.20.   We noted the concern for Nepal's views on becoming a part of GPA and ITA. It will be conveyed 
to our compet ent authorities.  
5.21.   Over the years, Nepal has taken series of initiatives to promote and diversify the economy 
and exports so as to achieve sustainable and inclusive economic growth, poverty reduction, and 
improvement in the living standard of the Nepalese p eople.  
5.22.   Nepal Trade Integration Strategy (NTIS) 2016 is Nepal's third generation trade integration 
strategy. NTIS 2016 seeks to address the outstanding trade and competitiveness challenges 
confronted by the country's export sector. The strategy focuses on i dentifying actions to address 
protracted constraints in a number of cross -cutting areas such as institutional capacity building for 
trade, business environment for investment and trade and transport facilitation, standards and 
technical regulations, sanita ry and phytosanitary measures, etc.  
5.23.   The efforts of both public and private sectors on trade diversification are underway.  
5.24.   We would like to reiterate that Nepal is a staunch supporter of the transparent and rule -based 
multilateral trading system. Nepal ful ly acknowledges the importance of notification as a 
fundamental pillar of transparency principle of the WTO. We have been notifying to the WTO time 
and again. However, we have experienced capacity constraints in data management and knowledge 
and skills on the substance and process of the notification.  WT/TPR/W/159  • Nepal  
 
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  5.25.   Nepal has introduced an integrated IP Policy 2017, which addresses both copy rights and 
industrial rights related affairs. The IP Policy envisions the protection of IP rights, such as Utility 
Models, Geographical Indications, Collective Marks, and Certific ation Marks, Layout designs of 
Integrated Circuits, Undisclosed Information and Trade Secrets. Likewise, it also envisions the 
protection of well -known marks under specified grounds, passing off provisions and the protection, 
promotion and development of a ll IP rights. As Nepal is a party to the Paris Convention, Berne 
Convention, Stockholm Act and WTO -TRIPs, compliance of international obligation has been well laid 
in the Policy.  
5.26.   The IP policy aims to create a balanced IP system in Nepal with a vision of building a creative 
nation through protection and promotion of IP. To enforce the IPR Policy, a new IP Bill is being 
drafted.  
5.27.   Despite various efforts, Nepal's export did not go up on its accession to WTO, unlike prior 
anticipations. Given the set targets o f the country for graduating from the LDC status by 2022 and 
becoming a middle -income country by 2030, there is no way other than enhancing the contribution 
of export to national economy. In this regard, a Herculean task lies ahead for us.  
5.28.   Land-lockedness , coupled with poor transport connectivity has involved huge transit cost for 
us in international trade. The cost has further weakened our competitiveness. It is noteworthy that 
with the advent of multilateral trading system, tariffs were lowered, yet non -tariff walls have 
emerged as a new challenge. Nepal, despite being extended DFQF market access being an LDC, is 
yet to take the advantage from the market access for the reason of non -tariffs. In the meantime, 
the ballooning import has resulted in an alarmi ng level of trade deficit to Nepal. The export -import 
ratio - 1:3.5 in 2004/05 soared to 1:6.7 in 2011/12. This has further deteriorated to 1:13 in the 
year 2017/18. In the last five years, trade deficit has nearly doubled. The share of import in total 
trade is 94% while the export in total trade is only 6%. Looking at the gravity and severity of the 
problem, Nepal alone cannot overcome certain challenges tied up with it. Thus, we request Member 
countries mainly those trading with Nepal to be considerate en ough in such issues.  
5.29.   Although a number of praiseworthy efforts are taken by the Government, we still face several 
constraints to economic growth. Nepal is constrained to a great extent with the state of land 
lockedness. Being an LLDC, the trade costs are higher compared to coastal countries. Such costs 
erode our competitiveness. The current focus on developing connectivity infrastructures, promoting 
investment in productive sectors, and improving doing business is expected to reduce the trade and 
transit c osts.  
5.30.   Aid for Trade is instrumental but requires greater attention of development partners. The gaps 
in the level of commitment and disbursement on AfT, poor coordination and duplication of donors' 
programmes, effectiveness in implementation, higher focus  on soft part are the pertinent issues that 
we should collectively fix.  
5.31.   We look forward for continued and enhanced supports, in the form of AfTs and trade related 
technical assistances (TRTAs), from bilateral and multilateral development partners, includin g 
Enhanced Integrated Framework (EIF). Also, we take this opportunity to extend our sincere thanks 
to our development partners for the supports provided so far.  
5.32.   We once again call upon our valued trading partners to support our exports by providing us 
with greater market access with simplified and facilitating rules of origin.  
5.33.   Before I conclude, my delegation wishes to thank everyone for your constructive engagement. 
Thank you.  
DISCUSSANT  
5.34.   Let me begin by thanking Secretary Chandra Kumar Ghimire and his te am for the statement 
delivered this morning and for following -up on the points raised on Monday.  
5.35.   I also took note of the statements of the 23 Members that have taken the floor on Monday 
and today, and thank them for enhancing the trade policy review proce ss with their substantive 
contributions. With 137 written questions from nine delegations, I trust this process has been useful WT/TPR/W/159  • Nepal  
 
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  for Nepal and the WTO Members in having a better understanding of Nepal's trade and investment 
policies and practices.  
5.36.   I would a lso like to express my appreciation for the opportunity to share some of my 
reflections before we conclude Nepal's second Trade Policy Review.  
5.37.   First, many delegations commended Nepal for its commitment to the multilateral trading 
system, which was demonstr ated through their participation in this TPR process, including the 
adoption of the alternative timelines and the timely provision of responses to Members advanced 
written questions.  
5.38.   Second, another cross -cutting theme that came out throughout the course of Monday's 
meeting was Nepal's impressive economic growth despite the challenges encountered during the 
period under review. Several Members also recognized Nepal's significant institutional reforms, 
including the enactment of its new constitution, which is a positive move towards achieving its full 
economic potential, and, among others, Members noted and encouraged Nepal's efforts towards 
attracting FDI and improving the ease -of-doing business climate, and protecting intellectual 
property.   
5.39.   There were, h owever, a number of areas commonly identified by Members as needing further 
improvement. These include: outstanding notifications to be notified to the different committees; 
applied rates of some tariff lines exceeding the bound rates; strengthening of its  intellectual property 
protection; and low utilization of concessional market access provided to LDCs, such as through GSP 
and DFQF schemes, as well as some bureaucratic hurdles for foreign investors and traders.  
5.40.   Nepal was also encouraged by a number of WT O Members to join the Information Technology 
Agreement, the Government Procurement Agreement, and the Joint Initiatives on Women's 
Economic Empowerment, and Micro, Small and Medium Enterprises (MSMEs). As we know, MSMEs 
form the backbone of most economies in the WTO and so we urge Nepal to consider empowering 
MSMEs in their own economy to contribute to economic development and aspirations of the Nepali 
people.  
5.41.   In addition, Members who intervened also spoke on the state of their bilateral trade and 
investme nt relations with Nepal and expressed the hope and intention for increasing the bilateral 
trade and investment relations, and I do believe this aspect of the TPR process is of significance as 
greater bilateral trade relations is indeed as well a desirable by-product and function of 
multilateralism and the functioning of the WTO rules -based system.  
5.42.   In conclusion, I wish to highlight that Nepal has made significant steps forward during the 
period under review. I encourage Nepal to stay on the path of reform and I look forward to seeing 
the projected graduation in 2022 of Nepal from its LDC status and further other progress by the time 
of their next Trade Policy Review.  
5.43.   Once again, I would like to congratulate Nepal on a successful, its distinguished Minister and 
team on a successful Trade Policy Review. It was indeed an honour and a pleasure to serve as your 
discussant. Thank you.  
AFGHANISTAN  
5.44.   My delegation commends the Government of Nepal presenting its comprehensive trade policy 
report and notes the positive development and progress Nepal has made to improve and upgrade 
its institutional and legal frameworks through conducting intensive reforms and improving its public 
and business capacities.  
5.45.   Nepal is one of Afghanistan's partners. We highly value the bilate ral trade and cooperation 
between Nepal and Afghanistan.  
5.46.   I would like to end my statement by wishing the esteemed delegation of Nepal a very 
successful and productive Trade Policy Review.  
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  UNITED  STATES  
5.47.   We sincerely thank you, the Head of Delegation Mr. Ghimire, and Ambassador Teehankee for 
your insightful remarks this morning. We would also like to express our appreciation to the 
Secretariat and to the entire Nepali delegation for their constructive part icipation in this TPR.  
5.48.   We recognize all of the hard work involved in the review process and thank the delegation for 
the detailed responses provided to our questions. Our authorities in Washington are reviewing them 
carefully.  
5.49.   We applaud the Government of  Nepal on the steps it has taken to implement its new 
Constitution and to expand trade and investment. We note with particular interest the reforms 
undertaken to facilitate FDI and improve customs administration, such as the development of 
investment promo tion boards, the E -Customs Master Plan, and the National Single Window. We also 
commend Nepal on its efforts to ensure that young Nepali have adequate IT skills, as highlighted in 
UNCTAD's e -Trade Readiness Assessment. Reforms like these will undoubtedly s upport Nepal's 
progress towards graduating from LDC status and becoming a middle -income country by 2030.  
5.50.   As the first LDC to join the WTO through the full accession process, Nepal has demonstrated 
a strong commitment to the principles and rules of the WTO . We thank Nepal for their active 
engagement and especially for their work as a proponent of trade facilitation. We look forward to 
continued cooperation here in Geneva and elsewhere.  
5.51.   In closing, let me again thank the Nepali delegation for their particip ation in this important 
process. To those returning home, we wish you safe travels. I hope that I can visit your beautiful 
country by taking advantage of "Visit Nepal Year" in 2020.  
INDIA  
5.52.   We thank H.E. Mr. Chandra Kumar Ghimire, Secretary of the Ministry o f Industry, Commerce 
and Supplies of Nepal and Ambassador Teehankee for their insightful remarks this morning and 
appreciate the hard work which has been put in by the delegation of Nepal for this TPR.  
5.53.   The new Constitution adopted in 2015, lays a vision an d foundation for Nepal's socio -economic 
transformation and strengthening democracy, federalism and inclusiveness. We are encouraged by 
Nepal's focus on policies which promote innovation, investment, production, generate employment 
and diversify exports. Th ese measures, and other reforms being implemented which are being 
highlighted by Nepal in their Trade Policy Review, will augment the Government's efforts for 
promoting economic growth and achieving development goals.  
5.54.   Nepal also has vast potential in the h ydropower sector, with several large and micro hydro 
projects currently under construction. India and Nepal have a vibrant cooperation in this area, with 
a power trade agreement and growing investments in the area of power generation, transmission 
and grid  connectivity. We are closely working with Nepal to harness the vast potential of our trade, 
economic and investment ties.  
5.55.   Let me also reiterate India's commitment as a close partner for the socio -economic 
development and growth of Nepal. I congratulate th e delegation of Nepal, led by Mr. Chandra Kumar 
Ghimire, on the successful TPR, and wish them a safe flight back home.  
EUROPEAN  UNION  
5.56.   On behalf of the EU, let me first thank Nepal for the comprehensive overview presented last 
Monday of the main development s occurred during the review period.  
5.57.   The EU is very pleased to note that this Review has been extremely useful for better 
understanding the trade policy of Nepal, and hopes that it will duly take into account some of the 
challenges highlighted by Members.  
5.58.   The EU appreciates the timely replies provided to its questions. The EU has submitted some 
follow -up questions related to Nepal's alcohol regulations.  WT/TPR/W/159  • Nepal  
 
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  5.59.   I would like to close by congratulating the team for a very successful Review.  
MR. CHANDRA  KUMAR  GHIMIRE  (HEAD  OF DELEGATION)  
5.60.   First of all, we would like to express our very sincere thanks to the discussant, Ambassador 
Mr. Teehankee who came up on this second day of the TPR meeting with very insightful ideas and 
observations. He has filled in us a new round of inspiration and in the days ahead there are plenty 
of ideas we have garnered from his statement and insights.  
5.61.   Similarly, we are equally thankful to all the Member countries who candidly spoke, not only 
on the first day but also on the second day. You ha ve extended a great amount of inspiration, 
motivation, and that has provided us a new part for our days ahead, that is to further liberalize our 
reforms and our economy, and to further integrate ourselves into the global market.  
5.62.   Similarly, I take this oppo rtunity to thank the Secretariat team, mainly the TPR team, who 
did very hard work over the last year, and facilitated very well in organizing us to attend this TPR 
up to this mark. On behalf of myself and on behalf of the Government of Nepal I would like to extend 
our thanks to the TPR team.  
5.63.   A few things that we have noted, raised during the first day and even today, once we go back, 
we will consult with our authorities and will try to communicate you back. In this regard, I would 
like to add that if you h ave any further queries, we have our diplomatic Mission, our Embassy in 
Geneva, so I request you to take the advantage of the presence of our Embassy in Geneva. So 
please try to communicate to our diplomatic channel so that we will communicate back in writ ten 
form.  
5.64.   On the whole before I conclude, as I stated during my first day and even this morning, we 
have ample opportunities to grow. At the same time, we have a number of constraints or limitations. 
Having said this, one more thing I would like to add, h ardly there is any country in the world that is 
constraintless or limitationless, so we are not an exception in that regard. The only thing we should 
do or must do is to drive ourselves towards further liberalizing our economy and further integrate 
ourselv es into the global trading system that is the multilateral trading system.  
5.65.   In this opportunity, taking this liberty, I would like to express our sincere thanks also to our 
trading partner countries, including from our neighbourhood and also development par tners who 
have been in the past and also in the present generous enough to extend their partner cooperation, 
their partner support so as to see our country rising.  
5.66.   With this, I would like to take rest and conclude here. Thank you.  
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  6  CONCLUDING REMARKS B Y THE CHAIRPERSON  
6.1.  This second Trade Policy Review of Nepal has offered us a good opportunity to deepen our 
understanding of recent developments in, and challenges to, its trade and investment policies since 
the last review in 2012. I would like to thank the Nepali delegation, led by H.E. Mr. Chandra Kumar 
Ghimire, Secretary of the Ministry of Industry, Commerce and Supplies, for their constructive 
engagement throughout this exercise. I would also like to thank our discussant, Ambassador Manuel 
Teehankee, Perm anent Representative of the Philippines to the WTO, for his stimulating 
observations, as well as the 23 delegations which took the floor, for their active participation in this 
Review.  
6.2.  Members commended Nepal for the positive economic performance during th e review period, 
with an average annual real GDP growth rate of 4.4%. This was achieved despite being hit by big 
earthquakes in 2015 that caused considerable loss of lives, and damage to infrastructure and 
production. It was noted that Nepal is taking step s to diversify its narrow production and export 
base which continue to be concentrated in textiles, clothing and agricultural products and reliant on 
a limited number of trading partners, particularly India. Members encouraged Nepal to continue its 
economi c reform process, including through its National Trade Integration Strategy, and address its 
supply -side constraints, notably high transit and transportation costs. This, in turn, would enable 
Nepal to tackle its remittances -induced growing trade deficit, further reduce poverty, and achieve 
its objectives of graduating from LDC status by 2022 and become a middle -income country by 2030.  
6.3.  Members welcomed Nepal's adoption of a new Constitution in 2015. Nepal stated that the new 
Constitution laid down a solid foundation for the country's socio -economic transformation. Political 
stability should allow Nepal to update legislation and enact laws which were in development at the 
time of the last TPR, for example a bill on safeguards, anti -dumping and countervailing  measures.  
6.4.  Encouraging Nepal to continue its constructive engagement with the WTO, Members asked 
Nepal to fulfil its outstanding WTO notifications, including in the areas of domestic support for 
agriculture, customs valuation, import licensing, and servic es. Some Members asked Nepal to 
become an observer to the Government Procurement Agreement and the Information Technology 
Agreement (ITA), and consider joining ongoing discussions on the MC11 Joint Initiatives. Questions 
were asked about Nepal's two overla pping regional agreements, the South Asia Free Trade Area 
(SAFTA) and the Framework Agreement on the Bay of Bengal Initiative for Multi -Sectoral Technical 
and Economic Cooperation (BIMSTEC), and on Nepal's 17 bilateral trade agreements.  
6.5.  Nepal was praised f or the ratification of both the Trade Facilitation Agreement (TFA) and the 
Protocol Amending the TRIPS Agreement. Members noted that further to notifying its Category A, B 
and C commitments under the TFA, Nepal's Customs Reform and Modernization Strategies  Action 
Plan will be fully adopted by 2021, while the National Customs Single Window is being implemented.  
6.6.  Members appreciated that Nepal has a relative open trade regime with a simple average MFN 
applied tariff of 12% in 2018. Nepal also took several ste ps to further liberalize its trade regime, 
including ongoing programmes on import procedures, and the electronic government procurement 
system. Moreover, new laws have been enacted, such as the Industrial Enterprises Act 2016, the 
Special Economic Zone Aut hority Act 2016, and the Labour Act 2017, while other laws are being 
drafted, notably a new single tax code to improve, consolidate and harmonize the main domestic 
taxes. However, Members expressed concern over certain areas and invited Nepal to address th em. 
These include: cases when applied MFN tariffs exceed bound rates; simplify the corporation tax and 
excise duty systems; increase efforts towards regulatory transparency; and invest more resources 
on its standardization and conformity assessment infrast ructure.  
6.7.  Members praised Nepal's general openness to FDI and its recognition of the important 
contribution it can have on economic development. However, they encouraged Nepal to continue 
liberalizing its investment regime and address issues of institutiona l capacity to attract larger FDI 
inflows, with a view to facilitating commercial activity and stimulating sustainable growth. While 
acknowledging Nepal's progress regarding intellectual property rights (IPRs) including through the 
IP Policy 2017, Members u rged Nepal to have a more effective enforcement of competition policy 
and protection of IPRs.  WT/TPR/W/159  • Nepal  
 
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  6.8.  It was acknowledged that Nepal aims to double agricultural production in the next five years, 
shift a large part of the population to off -farm and other emerging  sectors, and develop a trade 
surplus for agricultural goods. Members showed interest about Nepal's plans to facilitate FDI in 
hydroelectricity and provide clean energy. Based on tourism -related receipts, Nepal became a net 
exporter of services during the review period, and Nepal targets welcoming two million tourists under 
its programme "Visit Nepal 2020". It was acknowledged that improving connectivity, particularly 
with respect to telecoms and transport, is an imperative for Nepal for raising efficiency of the 
economy and the competitiveness of Nepalese exports.  
6.9.  In conclusion, Nepal has provided answers to almost all advance written questions raised by 
Members before the deadline. This TPR will be successfully concluded once Nepal has replied to all 
outstanding questions that emerged during the meeting in a month's time. I believe Members felt 
heartened by the reforms undertaken and the good results achieved by Nepal and encouraged it to 
persevere in that path and address the remaining challenges. I hope t hat the discussion held during 
this review will prove useful to Nepal in the continued implementation of economic and trade reforms 
and in its pursuit of policies to achieve sustainable growth and social development.  
__________