‘It is the right of a country like Nepal to get transit facility for third-country trade’

The country has been facing severe shortage of daily essentials and industrial raw materials as Indian side has been dispatching very few trucks and containers owing to security concerns of their freight companies and transporters due to ongoing protest in the Tarai. The trade sector has been affected the most due to the obstruction in movement of vehicles from India to Nepal. Nepal-bound cargo needs to be evacuated within 10 and 20 days after arrival of freight in Kolkata, ferried via road and rail, respectively. Due to obstruction in movement of vehicles, importers have been compelled to pay high detention charges to the port and shipping liners. Importers and exporters have been hit hard due to this. Pushpa Raj Acharya of The Himalayan Times spoke to Rajan Sharma, President, Nepal Freight Forwarders’ Association, to know more on the issue.

What is the recent update of the freight stuck at Kolkata port and border points?

As of Sunday, 853 containers are ready to be dispatched via road and 1,123 containers via rail. There are about 150,000 tonnes of bulk cargo of MS billet, coal and chemical fertilisers in 7,500 containers, which continue to be stranded and cargo has still been arriving at the Kolkata port. Likewise, 830 containers that need to be sent to Kolkata are stuck at ICD Birgunj.

Though international trade laws have guaranteed the free flow of goods and services, importers have been facing difficulties in bringing their consignments to the country in a timely manner due to the hassles from the Indian side in dispatching Nepal-bound cargo? What do you have to say?

We have to analyse this issue from two perspectives; first, the transit providing country should not think that the transit facility being given is a concession because the transit facility provided by India to Nepal is related to regional integration and economic prosperity and it is the right of a country like Nepal to get transit facility for third-country trade. And Nepal has been raising the issue of transit right with India, after Nepal-bound goods got stuck at Kolkata port and border points due to the obstruction from the Indian side in dispatching goods. Secondly, the most important thing is, we must incorporate international principles, rules and regulations in our bilateral trade and transit treaties as basic norms. If you thoroughly read the treaty of trade and transit, phrases like ‘contracting parties shall endeavour’ are chosen. Such vague legal texts can be interpreted or explained in different ways. It is also one reason that India, most of the times, mixes up security concerns in trade and transit issues. But, it is the obligation of both of us to resolve the issues that have emerged between us because we are friendly neighbours and bound to each other socially, culturally and economically.

Even though there is a situation of a semi-blockade from the Indian side, no other country or signatory to international treaties has spoken yet?

The international community has been showing concern regarding the recent problems. Many diplomats in Kathmandu asked us about what actually the problem was because the obstruction in the movement of vehicles has created a fuel crisis across the country. There is difficulty in the operation of lifeline services like public transportation. The international community had also suggested Nepal to establish the issue of transit right as a trade facilitation measure at the World Trade Organisation when Nepal was the chair of least developed countries. But it is a pity that Nepal failed to establish transit right as a trade facilitation measure.

It, thus, means that the debate to internationalise the issue holds little water?

The Indian government has clearly said that this situation has been created due to Nepal’s internal problem. It has said its freight forwarders, transporters and container freight station operators have been hesitating to ferry goods to Nepal due to rising insecurity. This statement of the Ministry of External Affairs (MEA) of India has sensitised Nepali freight forwarders — we are seriously concerned about it. We are not angry with this statement but we are sentimentally hurt with the behaviour of the Indian government. Nepali freight forwarders have been playing a crucial role in supply chain management and we have good relations with freight forwarders of various countries and none of them have complained to us about the security and other problems in ferrying goods to Nepal. Nepal Freight Forwarders’ Association has not received any information from Indian transporters and freight forwarders about any threat in Nepal. We also have the Joint Economic Commission (JEC) to resolve the issues of the private sector but till date no such issues have been raised at the JEC. This is why we have taken the Indian government’s statement as an allegation on the private sector and we have been hurt by that. After the MEA’s statement, the Indian side has not been dispatching trucks and containers like in the normal times from the check-points where there is no protest like in Mechi and Nepalgunj. On the other hand, agitating parties have been launching protests in ‘No man’s land’, and the Indian and Nepali security personnel should be coordinating to remove the protesters from the ‘No man’s land’. But that has not happened. These are serious concerns.

Nepali importers have been facing a huge loss as the detention charge imposed by shipping liners and Kolkata port is increasing by the day. How can it be minimised?

We have assumed that detention charge being levied by the shipping liners and the port authority has exceeded Rs 125 million a day as the volume of freight stuck at the port and at the border points has been increasing. The detention charge being borne by the importers can be minimised only through managing smooth movement of goods from India to Nepal. Though the Indian government has raised security issues in sending goods to Nepal, none of the stakeholders at the port has halted work — customs house agents are declaring the customs transit declaration of Nepal-bound cargo, shipping liners have been sending containers to Nepal, and truckers have been loading their vehicles to ferry goods to Nepal. As many as 351 containers have been booked with Container Corporation of India, which ferries freight to Nepal via rail. Nepal government has been repeatedly saying that they have fully arranged the security to escort transporters on highways, and none of the transporters have complained about security problem in Nepal. And it is obvious that it is Nepal government’s duty to provide security to the vehicles and transporters. But the Indian side has been sending only a handful of trucks and containers each day, whereas 2,500-3,000 vehicles laden with essentials and industrial raw materials used to enter Nepal from India every day. They have been sending containers only to manage congestion at the borders and the port. The same situation is being witnessed in rail movement — rail movement was also halted for 28 days without reason and only recently did it resume after congestion at Kolkata port. The statement issued by MEA of India all of a sudden has created a raft of problems in the smooth movement of goods from India to Nepal.

The government recently formed a committee chaired by the foreign minister to hold talks with India. Will the committee be able to sort out the problem?

We had spoken to the government to send a delegation of government officials and private sector to India to hold talks with the Indian government and private sector to resolve the issue. We also talked to the Federation of Nepalese Chambers of Commerce and Industry to send a delegation, but both the government and private sector remained silent. As the MEA of India has said that the Indian private sector is to blame for this situation, we need to take up this issue seriously. It is only later that our government formed a committee chaired by the foreign minister and comprising government officials but it is the short-sightedness of the government that the committee does not comprise private sector representatives.