Recent Developments in Nepal’s Trade Logistics: Implications for BIMSTEC Cooperation
Nepal’s total trade was accounted for 43.2 percent of gross domestic product in 2014. Nepal’s trade with Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) countries accounted for 70 percent of its total trade in the fiscal year 2015–16. Trade logistics is one of the most important elements of connectivity development. Nepal’s international trade is relatively weak with continuous and widening trade deficit. Though improving, trade logistics are inadequate and inefficient in the country. Nepal has entered into some landmark agreements with India and China, which will have long-term impact on strengthening trade logistics required to support Nepal’s foreign trade. However, Nepal’s implementation capacity is very low, and also there are instances of bilateral agreements not being implemented or delayed for long. If these agreements are implemented, they will enhance connectivity among BIMSTEC countries and market integration between not only Nepal and China but also between BIMSTEC countries and China.