Remarks by Foreign Secretary at IFA Seminar on Economic Diplomacy 18 April 2022

Remarks by Foreign Secretary Mr.  Bharat Raj Paudyal at IFA Book Launch and Seminar on Economic Diplomacy organized on the occasion of the 50th anniversary of the establishment of Nepal-Bangladesh Diplomatic Relations
(Kathmandu, Monday, 18 April 2022 at 11:00 hrs.)


Executive Director of the Institute of Foreign Affairs, Dr. Rajesh Shrestha

His Excellency the Ambassador of Bangladesh to Nepal,    

Former Ambassador of Nepal to Bangladesh Dr. Mishra,

Distinguished Guests,

Ladies and Gentlemen,


Namaskar and good morning to you all!

  1. At the outset, let me thank the Institute of Foreign Affairs for organizing this program of book launch and seminar on economic diplomacy on the occasion of 50th anniversary of the establishment of Nepal-Bangladesh diplomatic relations.
  2. I commend the efforts of IFA for bringing out different publications to its credit. Out of the two important publications that were just launched this morning, continuity of the peer reviewed Journal of Foreign Affairs to its second volume is worthy initiative to note. I wish IFA will be able to continue this flagship publication in the future as well and congratulate all those involved in making this volume of the journal possible. To my understanding, the quality of the second volume of the journal has also been significantly enhanced.
  3. Similarly, I believe the other publication that was launched today i.e. the Handbook of International Relations and Nepal’s Foreign Affairs has put together a compilation of lexicons that have received currency in contemporary international relations. I hope this will be useful to those interested in this discipline.
  4. I also thank previous speakers Ambassador Chaudhary and Ambassador Mishra for their valuable insights.
  5. Nepal and Bangladesh enjoy close and cordial friendship that goes beyond formal diplomatic relations, which were established on 8 April 1972. Nepal was one of the first countries to recognize the independence of Bangladesh.
  6. Our relation is characterized by commonality of development aspiration, goodwill, mutual respect, cooperation and bonds of socio-cultural linkages. The relations between the two countries are as natural as the rivers flowing from the Himalayas meeting the sea in the Bay of Bengal.
  7. Nepal’s foreign policy aims at strengthening relations with friendly countries at the bilateral, regional and multilateral levels. Economic diplomacy has been recognized as a key component in the service of foreign policy, through which we strive for contributing to the achievement of sustainable socio-economic transformation in the country, projecting Nepal’s image abroad and safeguarding the welfare of Nepali citizens.
  8. As we prepare for a resilient recovery after a consistent battle with COVID-19 pandemic for the last two years, the significance of economic diplomacy is far more evident than ever.
  9. Collaboration with private sector and think-tanks would help create synergy and provide much needed impetus for enhanced trade and investment and diversify areas of mutually beneficial economic partnership.

Ladies and Gentlemen,

  1. Economic partnership is the key area where Nepal and Bangladesh can work together for further expanding and diversifying the relationship. There are at least five areas, and this is not an exhaustive list in any way, that our two countries can instantly reap mutually beneficial economic benefit through greater partnership. Let me briefly touch on them:
  2. First and foremost is in the areas of trade. Even if we trade under the existing regional framework of SAFTA, the two countries do hold potentials to increase the current amount of trade manyfold provided we rationalize our tariffs and limit the non-tariff barriers to a minimum. Of this, particularly noticeable has been the high duties levied on Nepali agricultural and primary products. Negotiations on preferential trading arrangements at the bilateral level are on. I hope we would be able to find a mutually agreeable way out to harvest a variety of low-hanging fruits that are lying in the trade sector.
  3. Second, is the energy sector. Nepal’s rivers have enormous potential to contribute to clean and green energy security of our region. This sector offers a new vista of sustainable and long term beneficial collaboration between Nepal and Bangladesh. We have signed MOU on Cooperation in the Field of Power Sector in 2018 to increase collaboration in hydro-electricity generation and power trade for mutual benefits. As both our countries are committed champions of climate change agenda, Nepal’s hydro-power provides most sought after alternative for clean energy mix for Bangladesh. And, this can make a significant investment opportunity in Nepal from Bangladesh to harness its resources and generate employment as well as increase export to Bangladesh in order to maintain a sustainable and long-term trade balance. There also exists a promising potential in trilateral cooperation for cross-border energy trade between Nepal, Bangladesh and India as we grow and prosper together.
  4. Third, both Nepal and Bangladesh are graduating from the LDC status by 2026. It provides us a unique impetus for further expanding and deepening our cooperation to meet our development priorities. Nepal and Bangladesh will have to address the challenges in implementation of SDGs, ensure a smooth, sustainable and irreversible graduation process and expand areas of economic development that provide sustained basis for improving lives and livelihoods of our people. While we will have to pave ways for mitigating the erosion of trade preferences in international markets, at the same time, we must also work towards creating sound basis for more robust and comprehensive economic partnership and fully utilize existing complementarities.
  5. Fourth, we are too close a neighbor separated by a narrow stretch of merely 22 kilometers of distance between us. Improved connectivity of transport infrastructures (that includes roads, railways, air connectivity), transmission lines, optic fiber, improved customs facilities is critically important to create a mutually beneficial condition for a long-term and sustainable economic partnership. Connectivity not only facilitates trade, it also connects peoples, cultures, businesses, and promotes investment and economic opportunities. For Nepal, improved connectivity and trade facilitation measures with Bangladesh hold potentials in reducing cost of trade, providing cost-efficient transit facilities and opening yet another viable transit route to the BIMSTEC countries and beyond. We are grateful to Bangladesh for providing an additional transit route via Rohanpur-Singabad railway transit that would facilitate Nepal’s access to Chittagong and Mongla Ports and help boost regional and sub-regional trade.
  6. And fifth, travel and tourism sector has vast potentials to strengthen business partnership and share experiences in the promotion of sustainable tourism. Similarly, cultural exchange between the two countries would help foster mutual understanding and strengthen the bonds at the people’s level. Both our countries offer unique touristic products to each other. While alluring Himalayan mountains and soothing climatic condition of Nepal might be good touristic attractions to our Bangladeshi friends, Nepali people are naturally keen to see the longest sea beach of Chittagong and mangrove forests of Bangladesh. Tourism between our two countries can be cost and time effective alternative due to our proximity provided that we develop and keep open all modes of connectivity between us.
  7. To conclude, I believe the two substantive sessions of today’s seminar dedicated to the LDC graduation and transit facilitation between Nepal and Bangladesh will provide opportunity for further discussion and distilling of ideas on those two important areas for Nepal and Bangladesh today.

I am delighted to see the presence of luminaries and authorities in their own right on those areas of expertise who will contribute to these deliberations. I wish for a constructive and productive discussions and conclude my remarks by thanking, once again, the Institute of Foreign Affairs for hosting this timely seminar and inviting me to be part of it.

  1. I thank you.