Kathmandu, December 7

Insurance Board (IB) has granted permission to the insurance companies to extend the validity of coverage period for freight stuck at Kolkata port from 60 days earlier to 90 days, in view of the difficulties faced by importers in ferrying cargoes due to border-blockade.

As per IB’s circular issued recently, 17 non-life insurance companies can extend coverage time of 30 days and insurees can obtain the service by paying additional 10 per cent of the premium amount.

According to Nepal Freight Forwarders’ Association (NEFFA), about 1,800 containers of Nepal-bound cargoes are stuck at Kolkata Port, which are yet to be received by Container Corporation of India (CONCOR) — a subsidiary of Indian Railway that ferries goods to Nepal to Inland Clearance Depot (ICD) Birgunj. CONCOR ferries around seven to nine rakes (that is, 644 to 828 containers) by rail in a week.

Once the containers get forwarding number or when CONCOR receives the containers, Nepali importers need not extend the coverage period because the risk will be covered by CONCOR’s insurance policy. However, traders have said that IB’s circular is silent about cargoes in transit (ferried via road) and stuck at border point. Nepal-bound cargoes from third country and cargoes of bi-lateral trade that are also ferried via road have been most affected due to border-blockade of Madhes-based political parties.

Rajan Sharma, president of NEFFA, has said that the queue of vehicles laden with essential commodities and industrial raw materials at Panitanki (India) border waiting to enter Nepal through Kakarvitta Customs Point has stretched to over eight kilometres. Likewise, over 10-km long queue of vehicles are stranded at Sonauli (India).

“Cargoes ferried via road have been most affected due to the border-blockade,” said Sharma, adding, “But Insurance Board circular has not covered the cargoes ferried via road, which have been stranded at the border since long.”

The border-blockade has been continuing since last two-and-a-half months.

Sharma also said that IB’s direction to insurance companies to charge additional 10 per cent of the premium while extending the coverage period has put additional burden on importers at a time when they are incurring unimaginable losses due to high demurrage charge levied by Kolkata Port Authority and shipping liners, which have accrued due to border blockade and protests in few districts of Tarai region organised by Madhes-based political parties.

According to Sharma, importers in desperation have even started bribing Indian Customs officials to dispatch cargo vehicles. “Reports have started trickling in of importers dishing out INR 20,000 and INR 40,000 for 20- and 40-feet containers, respectively, after their insurance validity of 60 days exceeded.”

It may be noted that Himalayan Terminals Pvt Ltd (HTPL), a Nepal-India joint venture terminal management company, as per Nepal Intermodal Transport Development Board (NITDB)’s request, had waived the demurrage charges of 40 days between the period of September 20 to October 29 for delay in clearance of goods from the ICD Birgunj considering the difficulties faced in customs clearance by the cargoes stuck at ICD Birgunj due to the Tarai protest.

Likewise, shipping liners have also extended the turnaround period for containers of Nepal-bound cargoes from 21 days to 36 or 56 days owing to the unfavourable situation in Nepal, according to NITDB.