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25 Jun 2025
Nepal Implements Major Overhaul of Import Tariffs Across Key Sectors
Keywords
Nepal's government has announced a sweeping reform of its import tariff structure, aimed at protecting domestic industries, curbing non-essential imports, and responding to global price trends. The new measures affect a broad range of goods, including agricultural products, medical supplies, and industrial raw materials.
Key Changes by Sector
1. Agricultural Products
Frozen vegetables: Import duties raised from 10% to 15%, intended to promote domestic agricultural production and reduce reliance on imported staple foods.
Cashew nuts (in shell): Tariff lowered from 15% to 10%, likely benefiting Nepal's nut-processing and snack food industries that depend on imported raw materials.
Spices: While tariffs on single spices such as ginger and saffron remain unchanged, the import duty on mixed spices has been sharply increased from 20% to 30%-a move aimed at boosting local spice blending industries.
2. Medical Supplies
Plastic and rubber medical items: Adjustments vary. For instance, urine bags, previously subject to a 5% tariff, are now exempt from import duties altogether. This shift is expected to improve access to essential medical products and strengthen healthcare infrastructure.
Rubber-based medical garments and accessories: Tariffs have been significantly raised, likely to encourage domestic manufacturing or manage overall healthcare import costs.
3. Industrial Raw Materials
Kaolin-coated paperboard: Tariff increased from 15% to 20%, potentially reflecting efforts to shield local paper industries.
Rubber thread and cords for textiles: Import duty cut from 15% to 5%, aimed at supporting Nepal's growing textile and garment sectors by lowering input costs.
Strategic Objectives: "Three Protections, One Promotion"
Nepal's tariff reforms are guided by a "Three Protections, One Promotion" policy focus:
Protect agriculture by encouraging domestic production
Protect public health by improving access to essential medical goods
Protect domestic manufacturing by managing input cost structures
Promote local industries through strategic tariff adjustments
This policy is also seen as part of Nepal's broader strategy to ease trade deficits and foster industrial self-sufficiency.
Overview of China-Nepal Trade
In 2024, trade between China and South Asian countries approached USD 200 billion, doubling over the past decade with an average annual growth rate of 6.3%.
China-Nepal bilateral trade has surged, with total trade volume exceeding CNY 55 billion over the past five years, growing at an average rate of 11.7% per year.
Nepal's main trading partners include India, China, Argentina, the United States, the UAE, Indonesia, Australia, Ukraine, Malaysia, and South Korea. Notably, as of December 1, 2024, China granted zero-tariff treatment for 100% of taxable items from least-developed countries in South Asia, including Nepal, Bangladesh, and Afghanistan.
Around 70% of Nepal's daily consumer goods are imported. Key imports from China include household items, electronics, communication devices, and medical equipment. Due to its geographic proximity, Tibet continues to lead China's exports to Nepal, with robust growth in the export of "three new industries"-electric vehicles, lithium batteries, and photovoltaic products.
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