Nepal Trade
Integration Strategy
Presenters: Presented To:
Sebika Bohara Mr. Rojan Karki
Kampan Kafle Visiting Lecturer
Khusbu Raut Department of Agriculture
Kathmandu University
Table of contents
01 02 03
Introduction Objectives, NTIS and
Vision & Goals Agriculture
commodity
04 05 06
Features of NTIS Conclusion & Way
2023 Challenges Forward
& Recommendation
INTRODUCTION
What is NTIS?
Nepal Trade Integration Strategy (NTIS) is a flagship initiative aimed at enhancing the country's trade
competitiveness, diversifying exports, and integrating Nepal into the global trading system.
NTIS 2010
It is a critical building block in the Government of Nepal’s (GoN) effort to strengthen its ability to coordinate and
manage Trade-Related Technical Assistance (TRTA) and Aid for Trade (AfT) by implementing the mechanisms of the
Enhanced Integrated Framework.
INTRODUCTION
NTIS 2016
It is the Nepal’s third generation trade integration strategy that seeks to address the outstanding trade and
competitiveness challenges confronted by the country’s export sector which focuses on identifying actions to address
protracted constraints in a number of areas.
NTIS 2023
It is the latest iteration of Nepal’s trade strategy aimed at enhancing its export potential and integrating the nation into the
global trade system. It is implemented for five years starting from 2023 AD (FY 2079/80 BS) to 2028 AD (FY 2074/75
BS).
This strategy was developed considering the approaching graduation from LDC status to a middle-income developing
country in 2026. A total budget of NPR 46.32 billion (USD 349.62 million) has been estimated to implement NTIS 2023.
Furthermore, underlining the government’s commitment, the budget of FY 2023/24 has allocated NPR 40 million (USD
303 thousand) to implement the NTIS 2023.
HISTORY
2004:
Nepal approved its first Diagnostic Trade Integration Studies (DTIS) under the name Nepal Trade and
Competitiveness Study (NTCS).
2010:
Nepal developed the Nepal Trade Integration Strategy (NTIS) 2010, which identified 12 goods and 7 services as
priority sectors.
2016:
The NTIS 2016 was created and adopted, incorporating lessons learned and addressing challenges from previous
strategies.
2023:
After a seven-year gap, NTIS 2023 was developed despite the standard five-year review schedule. The delay was
due to political instability and frequent government changes.
OBJECTIVES
NTIS 2016
1. Strengthen trade and export enabling environment.
2. Focus on product development and strengthen supply capacity of priority products.
3. Strengthen institutional capacity, trade negotiation and inter-agency coordination.
4. Build and enhance trade-related infrastructures.
OBJECTIVES
NTIS 2010
1. Strengthen trade negotiations (especially bilateral).
2. Strengthen the technical capacity of domestic non-tariff barrier (NTB) and other business
environment supportive institutions.
3. Strengthen the export capacity of ‘inclusive’ export potential goods and services.
4. Strengthen GoN’s capacity to coordinate and manage Trade-Related Technical Assistance
(TRTA) and Aid for Trade (AfT) and to implement NTIS.
OBJECTIVES
NTIS 2023
1. Increase overall exports through value-added goods and services.
2. Strengthen the resilience of the trade sector amid global challenges.
VISION
To mainstream trade into the national development agenda
NTIS 2010 and use trade as an engine for inclusive and sustainable
economic growth and poverty reduction.
To enhance the export potential of Nepal through trade
NTIS 2016 integration, fostering sustainable and inclusive economic
growth, and addressing supply-side constraints to reduce
poverty.
NTIS 2023 To transform trade into a driver of inclusive and
sustainable economic growth.
NTIS and Agriculture
commodity
Key Features of NTIS 2023
Trade Infrastructure Development & Trade Facilitation
● A policy to develop a master plan for trade infrastructure
construction and improvement.
● The strategy includes formulating criteria for trade
infrastructure growth and improving digital trade through
logistics service provider training.
● The strategy suggests developing IT and physical transportation
infrastructure for easier cross-border trade.
Key Features of NTIS 2023
Labor, women’s empowerment and social cohesion
● There is a provision to establish a women empowerment and social
inclusion unit inside the NTIS department.
● The strategy has targeted to carry out research on challenges faced
by women in participating in trade and collect gender disaggregated
data.
● Furthermore, the strategy suggests carrying out awareness,
monitoring and evaluation of women’s participation in the export of
products and services.
Key Features of NTIS 2023
Food & Agricultural Commodities Infrastructure & Quality
● There have been several suggestions and recommendations related to
testing facilities and quarantine centers made in the NTIS.
● The strategy includes upgrading testing and plant quarantine
facilities in Kathmandu and Birgunj.
● It also involves establishing similar facilities at major border
crossings in coordination and provincial governments and
neighboring countries.
Key Features of NTIS 2023
Use of Fourth and Fifth Industrial Revolution
● The strategy identifies Business to Business (B2B), Business to
Customer (B2C), Customer to Customer (C2C), and Customer to
Business (C2B) as appropriate to use digital trade for cost
effectiveness and productivity.
● The creation of a national payment gateway and a national digital
depository for easier digital transactions has also been mentioned.
Key Features of NTIS 2023
Export Priorities
● In NTIS 2023, new additions include lentils, jute, produce,
fruits, spices and coffee along with handmade paper, rosin,
turpentine, aromatic oil, and long fiber textiles. In the large
scale industry category, iron and steel, cement, and ready made
clothing have been added.
● Small and cottage industries include jewellery, pasta,
Himalayan spring water, honey, dog chew and felt. Electricity
along with IT and business process outsourcing (BPO), tourism,
and skilled and semi-skilled professionals in remittance
generating professions has been included in services exports.
Key Features of NTIS 2023
Implementation, Monitoring and Assessment
● The strategy proposes additional roles and responsibilities for the
multilateral trade and trade facilitation of good and services trade,
gathering and analysis of trade market intelligence data etc.
● Similarly, the strategy recommends the formation of a National Steering
Committee to pass the annual budget, analyze progress, and provide future
direction for the plan.
● Furthermore, NTIS 2023 envisions making the role of development
partners, private sectors for effective implementation of the strategy.
Hindrances in NTIS Implementation
High Import Rate
▪ The trend in Nepal’s trade from 2004
to 2022.
▪ It is apparent that the imports have
been escalating at a significantly
faster rate than exports leading to a
widening trade deficit.
Hindrances in NTIS Implementation
NTIS 2016: Target 4% Roles and responsibilities of
increase in GDP federal and provincial
Quantity over Quality Roughly, 0.89% Increment government with regard to export
NTIS 2016: 12
promotion
NTIS 2023: 32
Ambitious Lack of
Prioritization
Targets coordination
Political NTIS 2016
Instability Challenges and Outcomes
Have not been able to fulfill all KPI
with subsequent action points that
were to be achieved within 5 years.
Challenges & Outcomes of NTIS 2016
• Tourism was selected as one of the export priority sectors in NTIS 2016.
• Ultimate Target : 1,344,000 tourists in a year, USD 136.6 per tourist spending per day, 15 days of average
stay in Nepal by 2017, and 2 million tourists by 2020.
• Tourist Arrivals: 940,218 in 2017, 1,197,191 in 2019 & 230,085 in 2020.
Average length of stay: 12.7 days,
Average Spending per visitor per day: USD 48
• Similarly, in the agricultural sector, ginger was identified as an export potential product in NTIS 2016. It
had aimed to achieve the production of 300,000 metric tons of ginger by 2020 and export 70% of it.
Policy Recommendation
Focus areas for export growth:
•Value-added processing for raw materials.
•Marketing and promotion of unique agricultural products.
Address Sanitary and Phytosanitary (SPS) barriers:
• Establish modern testing labs in Nepal.
• Decentralize implementation of the NTIS policy for local governments' involvement.
• Develop country-specific export plans
• Align trade strategies with national plans and stakeholder collaboration.
Conclusion and Wayforward
❑ The NTIS 2023 aims to boost the export volumes of prioritized products and services. However, experts
argue that previous versions of the strategy failed due to various implementation challenges.
❑ Key issues included poor coordination among government agencies, a lack of result-oriented
monitoring, inadequate infrastructure, and insufficient quality in export products. These shortcomings
are reflected in the 21.4% decline in Nepal's exports during the fiscal year 2022/23.
❑ Additionally, the long hiatus in Board of Trade meetings raises concerns about the effective execution of
the new NTIS. To achieve its goals, the strategy requires improved coordination and effective
implementation mechanisms.
References
https://enhancedif.org/system/files/uploads/Nepal_NTIS%202010.pdf
https://www.teacoffee.gov.np/storage/files/pdf-61545901871.pdf
https://www.tepc.gov.np/tepc_pub/2017_NTIS_Factsheet.pdf
https://www.fncci.org/ckfinder/userfiles/files/03%20NTIS%202016%20Addressing%20th
e%20needs%20of%20Women%20MSMEs.pdf
https://nepaleconomicforum.org/understanding-nepal-trade-integration-strategy-2023/
https://kathmandupost.com/money/2023/08/02/new-trade-strategy-lists-32-promising-exp
orts
Thanks!
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