October 17: The government implemented the policy of granting up to 8 percent subsidy on the basis of  the income earned from export of goods. The Ministry of Industry, Commerce and Supplies has implemented the Export Subsidy Procedure 2079 in order to provide subsidy up to 8 percent on exports as per the provision in the budget of the current fiscal year.

The new procedure has provision to provide 8 percent cash subsidy to a company which exports goods worth more than Rs 500 million in a year. However, the cash subsidy will be provided on the basis of the amount that exceeds the threshold of Rs 500 million.

In 2018, the ministry made a list of 26 items that are entitled to receive export subsidies.

After amending the procedure,  clinker, cement, steel, coal, resins and turpentine, plywood, tiger grass, fruits and dairy products (milk, cheese, cottage cheese, hardened cheese and fat) have been included in the list.

The ministry will provide 5 percent subsidy for the export of handicraft products, processed and unprocessed herbs, turmeric, fresh vegetables, flowers, cardamom, ginger.

Likewise, the government will give 4 percent cash subsidy for the export of clinker, cement, steel, resin and turpentine, plywood, tiger grass, fruit and dairy products (milk, cheese, cottage cheese, hard cheese and fat), and pashmina.

The subsidy for this group was increased to 4 percent from 3 percent

According to the procedure, the subsidy received by the exporter should be spent in the field of international market promotion, technology and capacity development, and e-commerce.

The subsidy will be increased by 1 percentage point if the goods exported from Nepal are exported with a collective trademark. If the export shows 20 percent increase as compared to previous year, another 1 percentage point will be added to the subsidy.