Nepali economic experts said on Sunday that the implementation of the South Asian Free Trade Area (SAFTA) agreement will help Nepal to boost its trade with South Asian countries.

Speaking at an interaction in Kathmandu, the capital, they said Nepal has to identify the goods of comparative advantage to penetrate the regional market.

Finalization of the SAFTA accord has given a message that economic agendas are also getting priority in the South Asian Association for Regional Cooperation (SAARC), said Prachanda Man Shrestha, joint-secretary at the ministry of industry, commerce and supply (MOICS).

He informed that as per the SAFTA agreement, developing countries will bring down their customs tariff to 20 percent while least developed countries (LDCs) will bring it down to 30 percent during the first phase between 2006-2008. Non-LDC nations will bring down tariff level to between 0 and 5 percent by 2009 while LDC nations will do so by 2016.

Though the agreement comes into force from Jan. 1, 2006, Nepal has to reduce its custom tariffs from August 2006 as the Nepalese new economic year begins from August, he noted.

"Nepal has to identify the products of comparative advantage and special areas to penetrate regional market, as Nepalese products are not competitive in SAARC region," said Shrestha.

Bishomver Pyakurel, a Nepali economic expert, pointed out the need of formulating policies as per the regional agreement and increasing the physical infrastructure.

He said the government and private sector should join hands to form supportive policies and to gain from the regional trading agreement.

Speaking at the same program, Rajesh Kaji Shrestha, businessman turned assistant minister for MOICS, assured that the government is ready to extend assistance for developing competitive strength of Nepalese enterprises.

Source: Xinhua