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US Expands Duty Free Benefits for Textiles from Nepal

An extended range of textiles and travel goods made in Nepal can now enter the United States duty free.

Last month, President Obama signed a proclamation to implement a trade preference program for Nepal. The so called Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA) will make imports of more items like shawls, scarves and travel goods duty free to the U.S.

The Nepal Preference Program, as the deal is being called, is good for 10 years and is aimed at aiding the country’s economic recovery.

“The legislation provides a unique opportunity for Nepali businesses to expand their exports to U.S. markets,” U.S. Ambassador to Nepal Alaina B. Teplitz, said. “These trade preferences will provide some support, but ultimately Nepal’s broader economic development will be achieved through policy reform that incentivizes investment, an improved business environment and labor reform that supports all sectors.”

A review of the products covered under the preference program by the U.S. International Trade Commission (USITC) determined the items are not import sensitive and won’t affect U.S. businesses producing similar goods.

Nepal was already enjoying duty free benefits on things like hand-loomed cotton fabrics, gloves and mittens, silk fabrics and apparel including dresses, women’s suits and scarves as part of the Generalized System of Preferences (GSP) program, but the new Nepal Preference Program will extend benefits to goods that weren’t previously eligible.

The country’s biggest exports to the U.S. include textile floor coverings, woven apparel, knit apparel and leather.

For the year ended October 2016, the U.S. took in $50 million worth of textiles and apparel from Nepal, a 5 percent decline from what it had imported as of the same time last year.