NEW DELHI: Nepal has promised India that it would end discrimination against car imports from the country and allow imports on the basis of self-certification by Indian government authorised manufacturers.
India, too, has removed special additional duty of 4% on all imports from Nepal that enjoy zero basic Customs duty under the Indo-Nepal treaty of trade following requests from the Nepalese government that its exports were losing competitiveness in the Indian market.
The assurances on the long standing grouses were given by commerce secretaries from both countries a meeting in New Delhi on Tuesday.
India had complained to Nepal that it permitted all countries, other than India, to sell vehicles through self certified `type approvals' or TAs, which was a confirmation of procedure commitment given by the manufacturer.
"The Nepalese side said that if the government of India authorises any manufacturer for giving self certified TAs, the government of Nepal will recognise the same," according to the minutes of the meeting.
To help Nepal export products to India, the country has done away with special additional duty of 4% on import of all products that are imported duty free under the Indo-Nepal trade treaty. The SAD was imposed in 2006.
Nepal's export to India is just $500 million, against India's exports of $2.2 billion.
India has, however, turned down Nepal's request of waiving excise on propane and butane imported by Nepalese companies from third countries, which are mixed in India and exported to Nepal. India said that such mixing was considered production acitivity which is subject to excise.
India also asked Nepal to restore margin of preference on import duty for Indian goods which was brought down from 20% in 2001-02, to 5% in 2006-07. Margin of preference is the difference in import duty levied on the preferred country as opposed to other countries. Under the South Asia Free Trade Agreement, of which both India and Nepal are signatories, Nepal gives margin of preference of 25% on applicable goods.
Nepal said that it would favourably consider the request in its forthcoming budget session.
Source : economictimes.indiatimes.com