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Textile & garment industries have been known to kick-start industrialization in many an emerging economy. They have been known for providing the impetus for transforming strategic course work writing industrial policies of import substitution to export promotion. These industries, due to their labor intensive character are also known for their large employment generation capacity. In other words, the industry has the potential to give a turnaround to the stagnant industrial atmosphere if opportunities are rightly exploited.

The history of the garment industry in Nepal is a little over a decade and half years old. Before that, garments in Nepal meant traditional Nepalese garments that were exported to a limited number of countries in limited quantities.

The meteoric rise of the garment industry was brought about by the interplay of various factors, both domestic and foreign. The much needed boost came at a time when garment exporting industries in Asia were hit by the quota system imposed by importers in Europe and America. This coincided with rising labour costs in garment exporting countries undermining their low cost advantage. Producers were forced to look for alternative, cheaper locations. Hence, Nepal emerged as a relocation site, especially for Indian producers who had already hit the quota ceiling. They began pouring into Nepal to evade the quota constraint imposed by the US Government during the late 1970s. It was then, in 1984/85, that the ready-made garments can be said to have entered the take off stage in Nepal. The Garment industry in Nepal has grown significantly in just last decade. The corporate development of the entire industry was commence since 1982/83. Since 1986 the government of United States of America imposed quota in common Garments Viz. Dress (336/636), Men’s Shirt (340) Women’s shirt (341) Skirt (342),Trouser sorts (347/48), Shirts man made fabric (640), Blouse man made fabric (641), Skirts man made fabric (642).

This young industry’s initiation was very haphazard and with no set policies by the government, though this scenario has changed quite a lot during the years. The government has set some policies which are deemed friendly to this industry. As a matter of fact, the garment industries flourished during the only due to the continuous efforts made by the industrialist albeit government policies aimed at developing this sector appeared once in a while. Signals are being noticed in the country’s export industries following the change in the world trade and global shift to liberalised economic policy. Since the garment industries being export based and have to compete with any countries, especially with the neighbouring countries in the international market, the policies adopted by these countries are bound to have direct impact in the garment export of Nepal.

The industrial sector plays an important role in a nation’s economic development, especially in a least developed country like Nepal. The statistics reveal that over the past few years the garment industries have made considerable contribution to the export sector by absorbing growing number of unemployed population and by helping reduce trade deficit to a certain extent. The garment industry provide direct and indirect employment opportunities to over a hundred thousand people, establishing as the second leading source of foreign exchange.

The statistical record of Nepal’s garment export are 3.93 billion rupees in 1992-93; 5.48 billion rupees in 1993 -94; 5.36 billion rupees in 1994-95; 5.41 billion rupees in 1995-96 and in 1998-99 it was wired upto 8.37 billion. Nepalese Nepal`s third country exports of RMG stood at Rs.12.01 billion in F.Y. 2002/2003 has now dropped to Rs. 6.72 billion in F.Y.2004/05. Such exports has stood at about Rs. 5.0 billion in the year F.Y. 2013/14.This suggests that there has been an increment of over 30% in the exports of the corresponding year i.e F.Y. 2013/14.  As  some increments have been observed in the recent times there is still an  urgent need to promote and consolidate this industry.Meanwhile, it shall be noted that GAN has been lobbying with buy lab reports the government as well as other platforms to allow  Nepal   Duty Free Quota Free(DFQF)  access  towards its  garments export to United States market. Besides, Government of Nepal(GoN) has been reviewing Nepal Trade Integration Strategy (NTIS) 2010  and GAN has been requesting with the latter  for its inclusion in the proposed document in order to receive more attention in the garment`s export.

In the early days of commencement most of the factories were established under financial & technical collaboration with Indian Industrialist. At that time more subsistent investment were covered by Indian Industrialist. But the fact is quite opposite right now. Most of the participants like labour & financiers are Nepalese. Among labors the women who are taken as ideal work force in the country participating significantly. The demand for rural female labour and the massive movement of women from rural house holds to production lines can help transform their social and economic Status. This flus can be used not only for industrial advancement by countries.