Nepal, India to sign MoU on rail survey, bulk cargo

- Post Report, Kathmandu

Aug 20, 2018-

Nepal and India are set to sign two key agreements on Kathmandu-Raxual railway line and movement of bulk cargo from three more transit points between the two neighbours on the margins of the fourth BIMSTEC Summit to be held in Kathmandu on August 30 and 31.

Officials are making preparations to sign a memorandum of understanding (MoU) for a preliminary survey of the proposed Kathmandu-Raxual railway line. India had agreed to fund the survey during Prime Minister KP Sharma Oli’s visit to New Delhi in April.

“India will fully fund the preliminary survey of the proposed railway line. Nepali and Indian railway officials will jointly conduct the feasibility study,” said Bhrighu Dhungana, joint secretary at the Ministry of Foreign Affairs.

Earlier, an Indian team had conducted the baseline survey of the proposed railway line from Chovar in Kathmandu to Raxual. The pre-feasibility survey is expected to be completed within a year, according to officials.

Nepal and India are set to sign a letter of exchange titled ‘Process Simplification and Additional Route’ for amending the bilateral Transit Treaty, paving the way to commence the movement of bulk cargos through three more border points.

“Both the agreements will be signed on the sidelines of the BIMSTEC Summit,” said an official.

Secretary at Ministry of Commerce and Supplies Chandra Ghimire told the Post that a Letter of Exchange will be exchanged between Nepal and India for amending the Transit Treaty to facilitate the movement of bulk cargos to the nearest railhead of major check posts at Jogbani in Biratnagar, Nautanwa (Bhairahawa) and Rupedhiya (Nepalgunj) on the Nepal-India border from the gateway ports—Kolkata/Haldia and Visakhapatnam.

The agreement will open the door for importing bulk cargo from third countries directly to Biratnagar, Bhairahawa and Nepalgunj via railway. Such facility is currently available only at the Birgunj customs.

At present, movement of such bulk cargo is in operation only in Kolkata/Haldia that often takes more than a month to reach Birgunj due to various hassles.   

“This will be a big breakthrough for the Nepali industries. Once we start operating the bulk cargo, at least six types of raw materials needed for Nepali industries will be available right at our border,” said Secretary Ghimire.  

The agreement is expected to bring along other benefits including drop in prices for industrial raw materials, low dependency on Birgunj for the big cargo and ease in distribution of bulk cargo across the country.  

Both the countries had been discussing the issue for long. Bulk cargo includes fertiliser, sugar, soy bean, salt, plastic and feeds. Such cargo items brought from third countries via Kolkata, Haldiya and Vishakapatnam ports are imported to Nepal only via the Birgunj border at present.

Businesspersons have been demanding bulk cargo handling from other border points too, arguing that the single gateway had forced them to increase their investment in raw materials, causing Nepali products to lose their competitiveness.

Citing a lack of railway infrastructure, India had been saying that it was difficult to provide bulk cargo facility at other border points.

In 2012, the Nepal-India Inter-government Committee had agreed to expand the bulk cargo facility to Biratnagar and Bhairahawa border points. The agreement, however, was not implemented as the letter of exchange was not issued.

Published: 20-08-2018 07:32

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