Govt slashes duty on garment imports from Nepal upto 75%

Nepal's ailing garment industry suffering due to a global slumpdown in demand has welcomed India's decision to slash duty on exports

to the country by upto 75 per cent.

The Nepali exporters will be now paying between half to two thirds less duty to India.

The amount of duty paid will come down to around Rs 4 million from Rs 12 million going by estimated annual apparel export of Rs 100 million and on the basis of 4 per cent customs duty, according to Nepali Garment Exporters' Association.

"The central government of India has issued a notification in this connection, rolling back the unfair decision," Vice president of Garment Association of Nepal, Uday Raj Pandey was qouted as saying by Kantipur.

The Indian policy decision has come as a great respite to Nepali exporters, said garment entrepreneurs. The sudden decision by Indian customs in the last week of August this year to charge customs duty on maximum retail price (MRP) instead of the invoice rate had created unnecessary hassles, they said.

"With the fresh decision of the southern neighbor, the duty volume on Nepali apparel will decrease two to threefold, and that means our competitiveness will strengthen in the coming days," Pandey said.

In a major policy reverse, India has rolled back its decision to impose customs duty on maximum retail prices (MRP) of garments exported to India and will now levy tax on the price indicated on the customs invoice.

The decision had brought exports of even top brands like John Players, Peter England, Ituchu and Pantaloons to a standstill.

Source: EconomicTimes