Exports Performance of Nepal: What Can Be Done?

Abstract

What can be done to improve the export performance of Nepal? is an important question as the Nepal’s progress on export is not satisfactory. Yes, the performance has not met the expectation of the stakeholders and even of the policymakers. In addition to the detailed descriptive analysis, I use a standard gravity modelling technique to answer this question using SITC, 5 digits data for the period 2005-2018. The econometric estimation results suggest that, Nepal could not gain meaningfully from its earlier steps in the liberalization and reform procedures rather its loosing export position. To come out from this situation, the estimated results suggest that Nepal’s should focus on some products that have high-value to weight targeting to reduce the transportation costs meaningfully. Nepal should adopt specific strategies, such as, build trade and manufacturing-focused infrastructure, initiate for bilateral trade agreements, improve the quality of the governance side by side of the reform process and second generation reform programs, tie up the education with national production system, and adjust the exchange rate system making more export friendly.