Nepal-India Agricultural Trade: Trends, Issues and Prospects

The study has assessed trends, issues and prospects of Nepal-India agricultural trade. The trade performance indicators viz. revealed comparative advantage, trade complementarity index and indicative trade potential have been estimated to understand the performance and prospects of Nepal's agricultural trade with India. The results have depicted a high comparative advantage for most of the exported agricultural items from Nepal with almost perfect complementarity in the agricultural export profiles of both India and Nepal. However, Nepal's export potential in the Indian market is not very encouraging, and in most cases the binding constraint to trade potential of Nepal is its limited export capacity and not the lack of opportunities in the Indian market.