A Nepal government team has conducted a study to determine if there is need for setting up a consulate general’s office at Visakhapatnam port in Andhra Pradesh, India. 

The government move comes amid Nepali freight forwarders’ demand for setting up such an office to facilitate third-country trade through the port.

A committee comprising representatives from Ministry of Foreign Affairs, Ministry 

of Finance, Ministry of Commerce and Office of the Prime Minister this week to study the need for setting up an office and other technical infrastructure at the port as demanded by the freight forwarders. 

On the basis of the committee’s report, government will soon take decision on setting up of the office, officials said. 

“We cannot talk about it unless we submit our report to the Ministry of Commerce,” said Buddhi Upadhaya, under secretary at Ministry of Commerce and Supplies, who is also a member of the study team.

Currently, the Nepal Embassy in Delhi is looking after issues related to this port. According to the embassy, since the port is automated and entire job can be done online, there is no need for an office right now. 

“Handling of goods bound to Nepal through this port till date is very low, so we can fully coordinate from here,” said Hari Prasad Odari, spokesperson for the embassy. “However, if the volume of transaction increases in future, we might need a separate office.” 

The agreement to allow Nepal to use Visakhapatnam Port for third-country trade was inked during then Prime Minister KP Sharma Oli’s visit to New Delhi in February. But there has not been any progress. 

After Nepal Rastra Bank, the central bank of the country, allowed banks to issue letters of credit to importers in October, Nepali traders were hopeful that the port would be functional soon. 

Cargo from this port can enter the country via Nepal-India border points of Biratnagar, Birgunj, Bhairawaha and Nepalgunj.

Currently, Nepal is totally reliant on the port in Haldia, Kolkata, to bring in goods from or send goods to third countries. Because of this, Nepal had long demanded access to another port.

However, the drawback in the use of Visakhapatnam Port is the distance from Nepal, which stands at around 1,436km. The port in Kolkata, on the other hand, is situated around 704 km from the country.

Losses that traders are likely to incur because of this factor, however, are expected to be negated by the presence of deepwater port in Visakhapatnam, which can handle bigger cargo vessels, reducing ocean freight cost. 

The port in Haldia, on the other hand, is relatively shallower, so cargoes need to be reloaded into smaller vessels in Singapore before they arrive in Kolkata.