Wednesday, December 5, 2012

Nepal seeks renewal with changes

KATHMANDU, Dec 6: Nepal has urged India to renew the bilateral Transit Treaty by adding five new trade and transit routes so that the country could start use of routes considered important for giving impetus to trade with other countries, including Bangladesh.

Existing Nepal-India Transit Treaty is set to expire on January 5, 2013. The treaty has a provision of automatic renewal, however, either side needs to approach the other for renewal if it wants to add or remove certain provisions.
“We have already sent a request to India for renewal of the Transit Treaty with changes,” said a senior official at the Ministry of Commerce and Supplies (MoCS). He told Republica that the ministry through the Ministry of Foreign Affairs (MoFA) has also requested the southern neighbor to hold secretary-level talks so that negotiations on changes that Nepal has sought could be concluded soon for timely renewal of the treaty.

Under the change, which Nepali officials have has been negotiating with India for a year now, Nepal has sought India to add in the treaty new land routes between Vishakapatnam sea port and four major customs, rail route between Birgunj dry port and Vishakapatnam and also Rohanpur (Bangladesh)-Singhabad (India)-Jogbani (India) and Phulbari-Banglabanda in order to facilitate Nepal´s foreign trade.

India in February 2011 had given its nod to open those routes as well. However, the two sides have not yet finalized modalities for operationalizing these routes.

“Through the secretary-level talks we hope to finalize operation modalities. It would pave the way for inclusion of those transit routes in the bilateral transit treaty,” said the source. However, India has not responded to Nepal´s call yet.

Trade experts have been emphasizing the need for operationalizing the new routes as they would enable Nepal to access the newly agreed Vishakapatnam sea port, which is more efficient than Kolkata port, for carrying out third country trade.

Likewise, inclusion of rail transit route and Fulbari-Banglabandh land route in the treaty is believed to do away with current problems that Nepali traders face while trading with Bangladesh. Most importantly, it will also ensure Nepal´s access to an alternate port of Mongla in Bangladesh for carrying out third country trade.

“We are awaiting response from India for holding the meeting which is scheduled to be held in Kathmandu. We wonder why it has not responded yet, for unless we settle the operational issues we will not be able to incorporate these provisions in the renewed treaty,” said the source.

Though India and Nepal exchanged initial drafts of Letter of Exchange (LoEs) last year, preparations to get the crucial deals signed have moved slowly mainly because the foreign ministry does not agree with India´s proposal to impose additional lock on containers ferrying third country consignments.

India has long been putting pressure on Nepali officials to agree on the additional lock system before the renewal of the Transit Treaty, citing security concerns and cases of trans-shipment of goods bound for Nepal in India.

Officials at MoCS, traders and experts have been saying that additional lock will not create any hassle. However, officials at the Ministry of Foreign Affairs say the Indian proposal goes against international norms and undermines Nepal´s transit rights.

Published on 2012-12-06 04:00:55

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