Benefits of Nepal Joining Global Trade Movements
Nepal can gain many benefits by joining trade groups like SAFTA (South Asian Free Trade Area), BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), and WTO (World Trade Organization). These memberships help improve the economy, increase trade, and connect Nepal with the global market. Here are the key benefits for Nepal in joining different regional and global trade movements are as follows:
i. Access to Larger Markets: Being part of trade agreements gives Nepal a chance to sell its products to more countries. For example, with SAFTA, Nepal can export products like tea, coffee, and handicrafts to countries like India and Pakistan with lower tariffs, increasing sales.
ii. Boost in Exports: Joining trade groups helps Nepal sell more products internationally. Under WTO, Nepalese goods like carpets and pashmina have better access to foreign markets, increasing exports.
iii. Attraction of Foreign Investment: Trade agreements make Nepal more appealing to foreign investors. For instance, BIMSTEC helps create cooperation in sectors like energy and tourism, encouraging investment in Nepal’s economy.
iv. Technology and Skill Transfer: Global trade agreements often lead to the sharing of new knowledge and technology. Through WTO programs, Nepal learns better farming methods and ways to improve industries, which helps businesses grow.
v. Economic Stability: Being part of these trade groups helps make Nepal’s economy more stable. By trading with many countries through BIMSTEC, Nepal isn’t too dependent on any one country, reducing risks to the economy.
vi. Better Trade Policies: Trade memberships like the WTO help Nepal adopt better trade rules. For example, Nepal improved customs processes and trade practices, making it easier to do business.
Hence, Joining trade groups like SAFTA, BIMSTEC, and WTO provides Nepal with opportunities to grow its economy by reaching new markets, improving exports, and attracting investment. However, to make the most of these opportunities, Nepal needs to improve its infrastructure and production capacity. Through SAFTA, Nepal can sell products like textiles and vegetables to neighboring countries like India and Bangladesh at lower costs. BIMSTEC also helps Nepal sell its hydroelectric power to other countries, bringing in more money.