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Indo-Nepal trade treaty renewed for 5 yrs

India and Nepal on Saturday extended for five years until March 5, 2007 the validity of the 1996 bilateral trade treaty that seeks to address the concerns over inflow of third country goods and surge in imports of certain commodities affecting the Indian industry.

The treaty initialled by the commerce secretary Dipak Chaterjee and his Nepalese counterpart Bhanu Prasad Acharya after six rounds of talks does not alter the basic framework of the treaty, foreign ministry sources said.

However, the protocol has been modified to take care of the concerns regarding value-addition norms and surge in certain commodities, sources said, adding that details of the rules of origin have also been adopted.

The existing treaty had been granted a unilateral three-month extension by India until March 5, 2002 after the treaty expired on December 5, last year.

Under the 1996 agreement, no definition of manufacturing and value addition was prescribed.

However, under the renewed treaty a safeguard clause has been inserted to permit appropriate remedial measures in tune with international norms in case of a surge in imports of certain commodities.

This is specially in reference to the imports of sensitive commodities like vanaspati, acrylic yarn, copper products and zinc oxide, sources said.

Duty-free imports will be allowed upto a certain ceiling and any import above the ceiling would be applicable for duty as prescribed under most-favoured nation status.

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