Does imported fabric still qualify?
The Protocol to Article V of the Treaty of Trade grants duty-free, quota-free access for articles manufactured in Nepal that (i) undergo a change of HS classification at 4-digit level from all third-country materials, which knitting fabric (Chapter 60) into garments (Chapter 61) does, and (ii) contain materials from outside Nepal and India worth no more than 70% of the FOB price (valued at CIF on entry into Nepal), with the final process in Nepal. Our fabric is mostly imported from China, so the 70% test must be calculated per style: lighter, lower-cost fabrics and higher making value pass more easily. Indian-origin fabric counts as local. We confirm eligibility before quoting duty-free. Trade and Export Promotion Centre (TEPC), Government of Nepal (source: Treaty of Trade between Nepal and India, with Protocol (Article V rules of origin), opens in a new tab) Trade and Export Promotion Centre (TEPC), Government of Nepal (source: Trade agreements – Treaty of Trade with the Republic of India, opens in a new tab)
What you receive and use at import
- A certificate of origin for each consignment in the treaty format (Annexure D/I), issued by the agency the Government of Nepal designates for this purpose. Indian customs clear goods on the basis of this certificate and may seek verification if in doubt, releasing the goods provisionally against a bond meanwhile. Trade and Export Promotion Centre (TEPC), Government of Nepal (source: Treaty of Trade between Nepal and India, with Protocol (Article V rules of origin), opens in a new tab)
- Duty-free refers to basic customs duty. The treaty allows India to levy an additional duty equivalent to its domestic indirect tax; today that is IGST at the rate for Indian-made garments, normally creditable for GST-registered buyers. Trade and Export Promotion Centre (TEPC), Government of Nepal (source: Treaty of Trade between Nepal and India, with Protocol (Article V rules of origin), opens in a new tab)
- Commercial invoice, packing list, Nepali export declaration and transport documents for the land-border crossing. Trade and Export Promotion Centre (TEPC), Government of Nepal (source: Trade agreements – Treaty of Trade with the Republic of India, opens in a new tab)