the trade activities of nepal are mostly centered with India , because of which there is huge gap in balance of trade. Suggest any three appropriate measure to minimize the trade deficit with India.

Nepal’s supply side constraints include political instability, low connectivity, a power generation crisis and difficult labor relation. In addition, geographic constraints such as high transit costs, delays at border crossing by red tape, waiting for transportation and lack of temporary storage at crossings has in total a negative effect on trade.

It follows that the recommendation for Nepal is that it must urgently address the factors that are minimizing its opportunities participating in WTO and relieve its widening global gap.

The country should focus on promoting products and services where it has competitive advantage.

It needs to expand its human resources base with better training and education for its entire work force.

The government should facilitate the financial means and encourage entrepreneurs to engage in trade activities.

Nepal should simplify transportation modalities that have high transit costs, improve its border crossing time, facilitate temporary storage and remove administrative hassles.

Overall improvements should also be made to the exports of agricultural products that could mean accesses to 400 million consumers in bordering India.

The government needs to implement policies that can attract foreign investment to develop or enhance basic industries that can promote capital growth and economic diversification.

In general, there is a great need for creating a favorable business environment in Nepal. Industrial unrest and rigid labor laws are some of the biggest obstacles to the industrialization of Nepal and its future participation in a fast globalizing economy

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