Nepal's Garment Industry Faces Existential Crisis Ahead of LDC Graduation
Summary
Nepal's garment industry faces a serious crisis as the country prepares to graduate from Least Developed Country status in 2026, threatening trade benefits and export competitiveness.
Key Points
- Nepal's graduation from LDC status in 2026 will end customs exemptions and quota-free access, impacting the garment industry heavily.
- The garment sector could suffer up to a 70% share of a projected 4% total export decline after graduation, risking 125,000 jobs.
- The 'Rule of Origin' requirement will increase costs for Nepali garments, limiting concessional benefits for imported fabrics, especially from China.
- Entrepreneurs call for strategic reforms including digital trade adoption, technology upgrades, and meeting international standards to boost exports.
