Railway agreement with India is being amended, what is the benefit to Nepal?

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Nepal-India railway service agreement is to be amended.

The government had taken forward the work of amending the agreement by including the demands raised by Nepali businessmen for a long time. Secretary at the Ministry of Industry, Commerce and Supplies, Dinesh Bhattarai, informed that the amendment has been moved to address the demands that have been made for a decade.

Finalizing the amendments already agreed at the technical level, the final approval of the Indian side is yet to come.

The draft amendment has been approved by the Council of Ministers of Nepal.The approved draft was sent to India. The Indian government had sent it to Nepal with modifications. After signing this from Nepal, he has gone to India again.

According to Bhattarai, the agreement has been approved by both the parties at the political level.

According to Secretary Bhattarai, there are issues such as the access of Nepali Railways to the seaports and breaking the syndicate of an Indian company in the cargo train bringing goods to Nepal.

There are two main points in the agreement. These are the two things that are welcomed by Nepali businessmen. Any cargo train coming to Nepal will be supplied by the amendment.At present, goods could only be brought from Container Corporation India Limited, a state-owned company in India.

Nepal’s trains can also go directly to Kolkata’s Haldia port. Nepali Railways will be able to bring goods directly to Nepal. Similarly, goods will be able to come directly from Calcutta to Biratnagar by train and other administrative matters will also be facilitated in the amendment.

What is the benefit to Nepal?

Entrepreneurs have said that the renewal of the railway service agreement will help reduce the cost of Nepal’s international trade. The Federation of Nepali Chambers of Commerce and Industry, Confederation of Nepalese Industries and the Chamber of Commerce have welcomed the amendment.

Avinash Bohara, a member of the Central Executive Committee of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), said that the amendment would be a game changer in reducing trade costs and making it competitive in the international market.

Bohara, who is well versed in international trade and imports and exports, says the amendment will be a game changer for Nepal for two reasons.

Due to the import-based economy, the cost of transporting not only ready-made goods but also industrial raw materials to Nepal was increasing.

He said the amendment would now put an end to such compulsions. An earlier agreement to break the monopoly of the Indian state-owned cargo rail company had been implemented. The train from Calcutta to Birgunj could not reach the unified customs. Bohara believes that this amendment will break all these obstacles.

“With the current amendment, we can also export from Nepal by rail. Until now, when there was no provision in the agreement, our exports were done by truck to the port,” he said. This costs up to $60 per tonne to send to the port of Calcutta.The same thing is now reduced by half when we send by train, ‘said Bohara.

He also said that it will be easier to take and bring goods from one’s own train once the Nepali Railways reaches the port.

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