Nepal to Seek Removal of Para-Tariffs at Bangladesh Commerce Talks

Nepal is preparing to urge Bangladesh to remove additional tariffs imposed on Nepali products during the eighth secretary-level commerce talks scheduled to be held in Dhaka on January 13 and 14, as the additional charges continue to hamper Nepal’s exports despite regional trade agreements.

A Cabinet meeting has approved a Nepali delegation led by Commerce Secretary Ram Prasad Ghimire of the Ministry of Industry, Commerce and Supplies to attend the meeting. Representatives from the Ministry of Finance will also join the delegation.

Spokesperson for the Ministry of Industry, Commerce and Supplies, Netra Prasad Subedi, said the talks will focus on bilateral trade and transit issues, including export–import facilitation. Although Bangladesh is a nearby and potentially large market for Nepali products, para-tariffs have long constrained exports, he added.

Despite both countries being members of the South Asian Free Trade Area (SAFTA), Nepal has struggled to benefit from preferential access to the Bangladeshi market.

Kshitij Dahal, senior research officer at South Asia Watch on Trade, Economics and Environment (SAWTEE), said Bangladesh remains a promising market, but significant barriers persist.

“Bangladesh has included around 1,000 products in its sensitive list under SAFTA,” Dahal said. “On top of that, para-tariffs force most exportable Nepali products to face high overall charges, even when customs duties appear low.”

According to him, Bangladesh can still levy high charges on certain Nepali products despite SAFTA provisions, mainly due to additional fees and charges beyond customs tariffs. These para-tariffs significantly raise the final cost of Nepali goods and weaken their competitiveness.

Discussions on a preferential trade agreement (PTA) between Nepal and Bangladesh have been ongoing since 2017. During a virtual secretary-level meeting in 2020, both sides agreed in principle to pursue such an agreement. However, Nepal has maintained that Bangladesh must first remove para-tariffs on Nepali goods.

“The issue of additional charges will again be raised in this meeting,” a Commerce Ministry official said, noting that para-tariffs have made Nepali products expensive in the Bangladeshi market. Nepal sees export potential in products such as cardamom, ginger and lentils, but bilateral trade remains limited.

Nepal continues to face a widening trade deficit with Bangladesh. In the first five months of the current fiscal year (up to mid-December 2025), Nepal exported goods worth Rs 211.7 million to Bangladesh, while imports stood at Rs 2.78 billion.

Data of the Department of Customs show a similar trend in the previous fiscal year (FY 2024/25), when Nepal exported goods worth Rs 666.1 million to Bangladesh but imported items worth Rs 5.1805 billion.