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Nepal and the United States have signed the Trade and Investment Framework Agreement (TIFA) on April 15. Deputy Prime Minister and Finance Minister Bharat Mohan Adhikari and United States Trade Representative Ron Kirk signed the agreement in Washington DC. The agreement is expected to open the possibility of preferential entry of Nepali products to the United States and reduce trade barriers.
Â
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Â
After signing the agreement, the first joint meeting was held to discussed and identify market potential of Nepali goods in the US market as well at to expand American investment in Nepal. Nepal is the fourth South Asian country to sign TIFA with US.
Â
The agreement has opened up the possibility to provide Nepali goods duty-free access to the American Market. Due to high tariff in the entry into US market, Nepali goods have failed to compete there. Though the US has committed to the World Trade Organisation provisions to provide duty-free access to 97 per cent of third world country goods, it has not implemented it yet.
Nepal had been enjoying the quota facility until 2005 in exporting garments to the US. After the US scrapped the quota system, garment export, diminished drastically. In 2010, Nepal imported goods worth US $ 28 million from the US. Major products imported from the US are aircraft, machineries and medical equipments.
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