Laxmi Capital News
FHAN lauds government efforts to promote handicraft sector

Butthe association is also concerned with the government’s failure to address someof the issues the association has been raising for the promotion of thehandicraft sector. 

Thegovernment’s announcement to run programs to develop and expand export-orientedindustries like carpet, jute, readymade garment, pashmina, cotton, shoes andhandicrafts with an objective to make the country self-reliant on keyindustrial products has elated the association. 

Issuinga statement on Friday, the FHAN said the budget allocation for the study toestablish one industrial zone, one economic zone, and one special economic zonein each province is positive. The government announcement to open an industrialvillage in collaboration with the private sector in each local unit is commendable,according to the FHAN’s statement. 

 Inthe budget speech, Minister Khatiwada had said that funds will be allocated toset up a permanent exhibition hall in all diplomatic missions abroad toshowcase Nepal’s handicraft and other products as part of the government’sefforts to promote export. The federation appreciated this decision. 

Likewise,the decision to increase the export cash incentive to 5 percent has drawnappreciation from the private sector, including the federation. Earlier, therewas 2 percent of cash incentive upon the export of goods and commodities fromNepal. 

 However,the federation has expressed concerns about the budget’s failure to address itsone key demand to amend a provision in the Public Procurement Act that requiresgovernment agencies to purchase goods worth above Rs 5,000 from only thosefirms which are registered for value added tax (VAT). 

“Industriesand firms producing handicrafts are not required to register for VAT. However,the provision to buy goods above Rs 5,000 through VAT-registered firms makes itdifficult for the government to buy from handicraft firms,” read the statement.“Handicraft industries were raising the issue to make amendment to thisprovision. However, the budget did not address the issue,” the statementadded. 

Similarly,the federation has also said that its request to amend a rule allowingexporters to send goods worth only $150 without advance payment certificate ofLetter of Credit. “The association has been requesting the government for yearsto amend such provision and allow goods worth $1,000 to send as sample, whichhas also not been addressed in the budget speech. This does not send positivemessage toward boosting export of the country,” the statement added.

Source: MyRepublica, 3rdJune 2018

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