Nepal is 'hopeful' that India will 'reconsider' its decision to ban import of palm oil

Following India's ban on import of refined palm oil from Nepal, the country's Finance Minister Dr Yuba Raj Khatiwada on Saturday expressed hope that India will reconsider its decision while suspecting a political reason behind the ban.

Speaking to the media, the Finance Minister said "We don't know why our neighbouring country banned palm oil. There should be some other politics behind it."

"We do hope that the Indian government will reconsider its decision. We are discussing this through our diplomatic channel, if necessary we can also go through the political channel," he said.

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Dr Yuba said the ban will affect Nepal's economy as the palm oil-related industry forms 25 per cent of the country's total exports.

He further said that the two countries have agreed to reduce the trade deficit and in that spirit, Nepal is hopeful that India will reconsider its decision. The ban came as a shock to the country, as there was no prior indication, the Finance Minister added.

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Speaks on the trade relations

Dr Yuba stressed that Nepal should be the closest destination for Indian and Chinese investors.

"Nepal's major trading partner is India. More than two-thirds of our trade is with India. India is one of our largest investment partner and perhaps the market for our products also. In that respect, India accounts a lot for our growth and prosperity."

The Finance Minister said that the ban on palm oil will have an impact on both the country's economies, in terms of markets, tourists, efforts reduction of poverty and migration.

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He further said that demonetization does not pose as a problem in the trade anymore. The border trade is smooth now, claimed DR Yuba.

Referring to the border dispute, between India and Nepal, he said: "Border issues are longstanding issues. We can politically resolve the issues and we have been solving our border-related disputes by amicable discussions. I don't think that should be an impediment to our deep bilateral relation."

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(With inputs from ANI)