Nepali and Indian government officials are scheduled to meet in New Delhi on Thursday to prepare for a long-planned review of the Nepal-India Trade and Transit Treaty. Trade between the two countries is governed by the Trade and Transit Treaty 2009.

According to officials, the preparatory meeting will discuss four key issues—implementing transshipment modality through Vishakhapatnam port, allowing Nepal to use alternative Indian sea ports, addressing hurdles with regard to trade passing over Indian territory and inviting Indian investment in different sectors.

The government will ask India to implement a transshipment modality at Vishakhapatnam port that will allow importers and exporters to clear customs paperwork quickly. For example, a Nepali trader importing goods from a third country has to present several documents at Vishakhapatnam port to get customs clearance.

After the transshipment modality is enforced, the trader will have to submit fewer documents for customs clearance up to the Nepal border.

Rabi Shankar Sainju, spokesperson for the Ministry of Industry, Commerce and Supplies, will be leading the eight-member delegation for the bilateral joint-secretary level meet.

According to Sainju, Nepal will present its proposal for the transshipment modality for Nepal-bound cargo released from Vishakhapatnam port. “We will be requesting the Indian side to implement the modality on a trial basis for a month,” Sainju said.

For this purpose, Nepal will propose to launch an electronic cargo tracking system (ECTS) for Nepal-bound containers.

“If the transshipment modality is implemented at the new port, it will also reduce the number of documents required to transport Nepal-bound consignments at the Indian port,” Sainju said.

Four months ago, Nepal piloted the ECTS for Nepal-bound cargo leaving Kolkata port with the consent of Indian authorities. Because of difficulties in officially enforcing a fully-fledged ECTS for cargo leaving Kolkata port, the government has planned to implement the system at Vishakhapatnam port which handles fewer Nepal-bound shipments.

Sainju blamed manipulation by customs house agents and freight forwarders for the poor implementation of the ECTS at Kolkata port. “If we succeed at Vishakhapatnam port, we will implement the modality on cargo passing through Kolkata port too.”

Meanwhile, Nepal will also urge India to allow it to use other Indian sea ports during the review of the bilateral treaty. The government has considered Dhamra port in Odisha and Mundra port in Gujarat among the options. Ministry officials even made inspection visits to these Indian ports last February.  

Assisting Indian investors to invest in the production business will also be high on Nepal’s agenda for the review meeting. The ministry said that it could help address the country’s expanding trade deficit as around 65 percent of its exports go to the southern neighbour.

Revising the provision related to reciprocity in bilateral trade and addressing the rules of origin imposed by the Indian government are among the subjects that Nepal wants to discuss with India during the review of the Trade and Transit Treaty that is expected to take place within three months.