Kathmandu — The United States has formally ended Nepal’s duty‑free access for 77 export items. The facility expired last Wednesday.
The program began after the 2015 earthquake to support Nepal’s economic recovery. Under the Nepal Trade Preference Program, the U.S. offered zero‑tariff entry for selected Nepali goods from 2015 to 2025. Government data shows that most eligible products saw low export volumes.
Although the U.S. Congress approved the facility in early 2016, Nepal exported only 29 of the 77 eligible items over ten years. The remaining 48 items recorded no exports, according to the Trade Promotion and Export Center (TPEC).
President Donald Trump also imposed an additional 10 percent tariff on Nepali exports starting last April. Before that, all 77 items entered the U.S. market duty‑free.
TPEC data shows fluctuating export performance.
- In fiscal year 2016/17, Nepal exported goods worth NPR 874.4 million to the U.S.
- Exports fell to NPR 766.9 million in 2017/18 and to NPR 671.2 million in 2018/19.
- Exports rose slightly to NPR 684.8 million in 2019/20, then dropped to NPR 606.1 million in 2020/21.
- Over the past three years, exports improved. They reached NPR 1.13 billion in 2021/22 and NPR 1.60 billion in 2022/23.
- Exports fell again to NPR 1.25 billion in 2023/24, then rose to NPR 1.26 billion in 2024/25.
Which goods were covered?
The duty‑free list included nine product groups: leather goods, cotton goods, plant‑based luggage, suitcases, headbands, needlecraft items, gloves, shawls, scarves, carpets, travel bags, purses, blankets, grain sacks, fiber products, and headwear.
However, many items never reached the U.S. market. These included commercial bags, leather and plastic purses, hand‑woven bags, caps, mats, travel bags, gloves, golf bags, some textile items, and hats.
Items that did export included leather and cotton goods, plant‑based luggage, baggage products, floor coverings, hand‑woven shawls and scarves, traditional wool items, sports bags, grain sacks, shawl blankets, fiber products, and headwear.
Analysts cite several reasons for the weak use of the facility. These include poor product selection, low production capacity, limited awareness among exporters, confusion about HS codes, difficulty completing required paperwork, and limited access for small producers.
Stakeholders say rural women who make small handmade goods were also included in the duty‑free list, but weak market access and poor export systems kept them from benefiting.
