Boosting exports and curbing imports is the best way to lower the alarming deficit in the country's Balance of Payment. This is a general classroom theory in economics but very difficult to translate in practice. Yes, the government has many means to check imports -it can raise custom duties, choke credit flow to sectors that are overheated and bring policies to substitute imports through domestic production, at least in the agriculture sector-but the million dollar question is: How can it boost exports at a time when basic requirements for industrialization such as infranstructure, power and security is at its weakest?
Even Nepal's traditional exportable products like woolen carpets and readymade garments, to name a few , are battling hard to survive. Not that there were no attempts from the government to revive the export sector. Export duties were lowered and arrangements were made for low-interest financing but the outcome has continued to remain pessimistic simply because most of the efforts were launched haphazardly without identifying the main reason behind decline in exports.The continuously declining contribution of the manufacturing sector to the country's total output itself is a testimony of our failed industrial policy. Against this background, the recommendations put forward by Trade Intergration Strategy study, which was made public last week,is welcome in the sense that it has at least identified commodities and services with export potential. It is agood start but there are lots of others issues that need to be solved before we can expect to see a robust boost in our export figures.