Nepal exported handicraft items worth 2.71 billion rupees (US$38.12 million) in 2006/07, as against 2.88 billion rupees ($39.39 million) of the last fiscal year, shows a statistics of Federation of Handicraft Associations of Nepal (FHAN).

Handicraft industry had grown by a cumulative 10.8 per cent in 2004/05 and 1.09 per cent in 2005/06, signaling signs of recovery from the 60.14 per cent dip recorded in 2001/02.

Entrepreneurs said that decline of 5.7 per cent for a single year does not indicate bad days for the industry as a whole. "However, continued decline of the major exportable items is a point of worry for us," Dilip Khanal, executive secretary of FHAN told The Kathmandu Post.

He attributed the latest decline of handicraft exports to the slump recorded in exports of pashmina products, metal crafts and handmade paper--the three key products that together contribute some 41 per cent of overall handicraft exports from Nepal. Statistics of FHAN shows that pashmina products, the largest handicraft exports that make up nearly 18.08 per cent of the total outbound handicraft trade, registered the least volume of export in the last three years.