Nepal will send a high-level delegation to India on Tuesday to hold talks with the Indian authorities over the possible impact of the Goods and Services Tax (GST) on the trade between the two countries. The delegation will discuss issues concerning GST recently imposed in India in relation to the bilateral Trade and Transit Treaty between the two countries, officials said Kathmandu.
The team led by Ravi Shankar Sainju, joint secretary at the Commerce Ministry, will arrive in New Delhi on Tuesday to discuss the issues. Officials from Ministry of Finance and Commerce will be included in the delegation. Nepal would be drawing attention of the Indian government over GST implementation in relation to the bilateral Trade and Transit Treaty, Sainju said.
“Though the actual impact of the GST on the bilateral trade is yet to be seen, Nepal government wants to address the problems the domestic traders might be facing following the implementation of GST,” he said.
Nepal expressed its concern following complaints raised by the traders and freight forwarders. “Goods intended for import into or export from the territories of either contracting parties from or to a third country shall be accorded freedom of transit through the territories of the other party. No distinction shall be made based on the flag of vessels, the place of origin, departure and exit destination or ownership of goods,” reads the bilateral trade.
Despite such provision in the treaty, the traders and freight forwarders have been complaining to the government about slow pace of movement of goods during export and import of goods to and from India since last week when the Indian Government enforced GST.
According to the traders and freight forwarders, the authority at the Kolkata Port earlier used to impose 15 per cent logistic service charge on goods imported from third countries. With GST coming into effect, that charge has been raised to 18 per cent.
“Although the GST should not affect Nepal’s trade, however with the confusion to the officials at implementation level, Nepali traders could have been facing problem,” Sainju said.
Landlocked Nepal depends on transshipment via India for trade with the rest of the world.