Kathmandu, Feb. 15:
Finance Minister Dr. Yuba Raj Khatiwada has said that the government was ready to share the production cost of the garment industries through subsidy in electricity consumption and concession in income tax.
"The government will announce subsidies and discounts in a package," he said while addressing the 26th Annual General Assembly of Garment Association of Nepal (GAN), an umbrella business body of garment industry and producers, in the Capital.
"But the export subsidy should be based on value addition therefore you need to exhibit that you have made at least 30 per cent value addition. 5 per cent subsidy is now given to more than 50 per cent value addition. The government is ready to increase such subsidy," said the Finance Minister.
According to him, the government will adopt policy to support the industries that generate employment and simplify subsidy obtaining process.
He informed that the government is in the final phase to implement the one door system for the business registration, operation and other activities. "Garment industry can substitute the import and fulfil the demand of domestic market as well. Therefore, the government will give its due priority," he said.
Dr. Khatiwada directed the Commerce Secretary Kedar Bahadur Adhikari and Deputy Governor of the Nepal Rastra Bank Chintamani Siwakoti to facilitate the exporters with one door system for export and subsidy, incentive disbursement and LC (Letter of Credit) opening.
But he urged not to express dissatisfaction on tax collection unless it is misappropriated.
President of GAN Chandi Prasad Aryal urged the government to announce policies to increase internal production in order to substitute import and promote the production of raw materials needed for garment industries to contribute to the development of local economy.
"Nepal has a huge potential in textile and garment business. About 700 million metres of cloth is needed to meet the demand of garment in the country. Therefore, the government should increase facilities to the investors in this sector and attract domestic and Foreign Direct Investment (FDI)," he said.
According to him, the GAN is having fever and we need antibiotics immediately.
President of Confederation of Nepalese Industries (CNI) said that the government should support in creating Nepali brands and promoting them in the international markets across the globe.
He said that there should be more investment in research and development, human resource development and education facilities on textile and garment sector.
Still the businesses are forced to fulfil the demands of the local people and the representatives which should be immediately discouraged, said Sharma.
Senior Vice-President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Shekhar Golchha said that Nepali industries had caught a downward trend in the past due to bad labour relations, energy shortage, limited market opportunities, legal complexities and political instability.
"But we have stable government with prosperity as its main agenda. Therefore, we hope that the investment and business climate would be better in the near future," he said.
He demanded to develop an export promotion zone (EPZ) exclusively for garment industry with training institutions and support industries.
Workers should be paid on the basis of their productivity and garment industries should be provided with subsidy on their value addition in order to promote garment export, said Golchha.
Former President of FNCCI Chandi Raj Dhakal said that the garment sector could contribute significantly to the income of foreign currency through the export of finished goods.
Vice-President of Nepal Chamber of Commerce (NCC) Kamlesh Kumar Agrawal pointed towards the need to increase support to investors.
"Our neighbours have better facilities than us while businessmen in Nepal are suffering from high interest rate and other barriers," he said.
Kathmandu Star Fashion Pvt. Ltd., Shree Nepal Fashion Pvt. Ltd. and Pearls Fashion Solution Pvt. Ltd. were facilitated on the occasion for their significant contribution in garment export.
Published in The Rising Nepal daily on 16 February 2019.
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