July 20: A few decades ago, hand-made carpets topped the list of Nepal’s export items. After a decline in market of carpet, income from export of carpet has increased once again.

Carpets worth more than Rs 8 billion were exported from Nepal to 68 different countries till May of the last fiscal year.

Although the quantity of export is not too high, Nepal's carpets have found markets from Europe to the Gulf and neighboring countries. Looking at the data of the last five years maintained by the Department of Customs, although the income from export increased in the last fiscal year, the quantity of export has declined. Due to the decline in the exchange rate of the Nepali currency for some time, the amount earned from the export of carpets has increased.

There is confusion about whether carpets exporters will get an 8 percent cash subsidy announced by the government through the budget for the current fiscal year.

The government has said that six different goods and services with high export potential will be given cash subsidy of up to 8 percent. Carpet producers are divided over whether this facility will be applicable for carpets, a traditional product that has been contributing immensely to the country’s exports.

Dawa Sherpa, General Secretary of Nepal Carpet Producers and Exporters Association said that exporters are confused by the government's announcement of 8 percent cash incentive policy.

"The government has said this facility will be provided to cement, footwear, among other industries but it is not clear what other industries mean," Sherpa said.

“Those who have access to power centres avail such facility but the small businessmen often fail to benefit from such announcement,” added Sherpa.

Joint Secretary at the Ministry of Industry, Commerce and Supplies Govinds Bahadur Karki said that according to the procedures of 2075, carpet industry is entitled to receive 5 percent cash subsidy but the announcement of 8 percent cash incentive is still not clear.

"There is definitely cash subsidy for carpet exporters," said Karki, "However, the dilemma whether they will get the 8 percent specified in the budget or not."

As the items have not been specified, there is confusion as to whether or not the carpet industry will get an 8 percent cash subsidy.

Businessmen say that many goods were stored in the warehouse during the Covid and orders are gradually increasing. According to the businessmen, there has been an improvement in exports due to the increase in orders after Covid-19 subsided along with the increase in demand for home decor, and the increase in the price of US dollar. In the first year of Covid-19, orders for carpet fell by 20 percent.