The nearly two-and-a-half month long border-blockade by Tarai-based political parties has severely affected the trade sector. Shortage of fuel and other daily essentials has had an adverse impact on economic activities in the country. The Nepal Intermodal Transport Development Board, which oversees the Inland Clearance Depots in Nepal, has been playing an effective role to waive the demurrage charges levied by shipping liners, Kolkata Port Trust and ICD management companies in Nepal citing the unfavourable situation in the country.  Pushpa Raj Acharya of The Himalayan Times spoke to Laxman Bahadur Basnet, Executive Director of NITDB to know more about their efforts to minimise the hassles being faced by the traders due to the Tarai protest.

As Nepal-bound cargo have been stuck for long at Kolkata port and Nepal-India border points due to the border-blockade, imports are for sure to be costlier due to high demurrage charges being borne by importers. What has Nepal Intermodal Transport Development Board (NITDB) been doing to minimise the additional costs to safeguard consumers because traders ultimately pass on additional costs to consumers?

Our main objective is to reduce the cost and time in trade in an effective manner to expand the volume of trade for sustainable economic growth. From the very beginning we have identified that we can be more economical and competitive by minimising the demurrage charges that Nepali importers are having to pay since long. At normal times also our traders are compelled to pay demurrage and detention charges of over one billion rupees annually to shipping liners, Kolkata port and container freight stations. Since assuming office a year back, I have been doing my best to minimise the additional costs that have been hindering us from being competitive. Some three months back, I travelled to Kolkata and organised a meeting with shipping liners and Kolkata Port Trust with support of Consulate General of Nepal in Kolkata. After the meeting, shipping liners agreed to extend the grace period for containers of Nepal-bound cargo from 14 days to 21 days. Recently, we also requested shipping liners through the Consulate General of Nepal in Kolkata to extend the turnaround period for containers of Nepal-bound cargo citing the unfavourable situation in Nepal due to the border-blockade. A majority of the shipping liners, namely, APL, Maersk, Safemarine, OOCL, Pacific International Lines and MSC have extended the grace period to 36 to 56 days temporarily. Likewise, Himalayan Terminals Pvt Ltd (HTPL), a Nepal-India joint venture terminal management company, on NITDB’s request has also waived the demurrage charges for a period between September 20 to October 29 (40 days) for delay in clearance of goods from the Inland Clearance Depot (ICD) Birgunj owing to the difficulties being faced in customs clearance by the cargo stuck at ICD Birgunj due to the Tarai protest.

Traders are also compelled to pay high detention charges to Kolkata Port Trust as they have failed to evacuate cargo within grace period extended by the port to Nepal-bound cargo due to irregular movement of trains and the border-blockade?

Shipping liners, which ferry Nepal-bound cargo, deliver the goods at Kolkata port and the freight is forwarded via both rail and road. We need to evacuate Nepal-bound cargo within 10 days if ferried by road and 20 days if transported by rail after arrival of the freight in Kolkata. Cargo ferried via rail is delivered to Container Corporation of India (CONCOR), a subsidiary of Indian Railways, which ferries cargo to Nepal’s only rail-linked ICD in Birgunj — and cargo gets stuck at the port yard or private container freight stations till CONCOR receives the cargo. Traders need not pay detention charge to the port once CONCOR receives cargo ferried via train within the grace period. However, CONCOR, sometimes takes more time to receive cargo and in this situation cargo needs to be parked at the port yard or private container freight stations. This is the reason why data of Nepal-bound cargo provided by the port authority and CONCOR varies. CONCOR only gives data of cargo that it has received and cargo in transit. Similarly, cargo ferried via road needs to be evacuated within 10 days and the freight companies or traders have to arrange for the trucks to evacuate the cargo. Due to the border-blockade cargo ferried via road has been highly affected. But, NITDB has been doing its best for the regular movement of rail-service from Kolkata to Birgunj and is also evacuating cargo stuck at ICD Birgunj so that rail service is not halted due to congestion at ICD Birgunj. Even in this difficult situation rail service was halted only for a few days due to congestion at ICD Birgunj. Despite the Tarai protest, we have managed to dispatch cargo from ICD Birgunj by providing escort facility with the help of security forces.

Traders complain that the grace period extended by Kolkata Port Trust lapses while arranging documents and sending them to Kolkata port for Customs Transit Declaration (CTD). Is there any possibility to ease this process?

If traders start sending documents to the Consulate General of Nepal in Kolkata by following the Know Your Costumer (KYC) practice in the same way that they submit their information to Nepal Rastra Bank, it would be easier for the Consulate General to recommend the port authority to clear the cargo faster. Traders should correct their methods first and open letter of credit in the name of genuine firms and submit information in a KYC pattern to the Consulate General in Kolkata. Traders are also responsible for delays in CTD.

It is reported that there is still a huge volume of cargo stuck at ICD Birgunj. How many days will it take to clear the cargo?

Cargo clearance from ICD Birgunj has been expedited recently. There is substantive bulk and break bulk cargo, reportedly, 75,000 tonnes of bulk cargo and 24,000 tonnes of break bulk cargo, as of Saturday. Large chunk of the break bulk cargo is chemical fertilisers imported by Salt Trading Corporation (STC) and Agriculture Inputs Company Ltd (AICL). We have already written to STC and AICL to clear their cargo and also urged importers of industrial raw materials to clear their bulk cargo. But there are difficulties in releasing bulk cargo like iron ore because there are a very limited number of vehicles to ferry such cargo to their destinations. We have been able to dispatch more than 7,000 trucks even amidst the Tarai protest by providing necessary escorting through security forces. Volume of bulk and break-bulk cargo exceeded 100,000 tonnes and 40,000 tonnes, respectively, in the last week of September as there were difficulties in dispatching cargo from ICD Birgunj. We have been releasing cargo and there is no congestion at the ICD and railway movement is regular.

NITDB has also launched Kolkata-Kathmandu corridor monitoring system that is expected to shorten the travel duration of railway and shipping line containers unloaded in various parts of country. Has this system been effective?

We have initiated Kolkata-Kathmandu corridor monitoring system with technical and financial support of the World Bank Group. We started this initiative because rail movement from Kolkata is sometimes halted in transit for long periods as Indian Railways diverts the locomotives as per its needs. We have also been monitoring shipping line containers unloaded in various destinations besides the ICD Birgunj and this corridor monitoring system is working effectively. We will focus more on monitoring after the situation normalises. Currently, we are more focused on evacuating cargo from ICD Birgunj. Moreover, our government needs to prioritise rail access to other dry ports while renewing railway service agreement (RSA) with India to avail effective and uninterrupted rail service for cargo movement.

Exporters have complained that CONCOR demands minimum one rake (45 containers) to transport freight to Kolkata and cargo is stuck for a long time till the required quantity is available. Has NITDB taken any initiative on this front?

I have spoken to HTPL’s chief executive many times regarding this issue. CONCOR has a major stake in HTPL and the HTPL chief has expressed commitment to talk to CONCOR to ease the movement of freight.

What has NITDB been doing regarding developing other ICDs?

We have also planned an ICD in far western part of country. We have held a dialogue with Millennium Challenge Corporation of the United States to develop an ICD at Mahendranagar of the far western development region and they have shown interest in it. However, things have not materialised till date. Similarly, we also signed memorandum of understanding with Architectural Reconnaissance and Design Institute of Tibet Autonomous Region recently for detailed design of ICD at Timure of Rasuwagadhi. China has pledged to establish a well-equipped ICD at Timure and we have acquired about nine hectares of land for the purpose. Once we receive detailed design, which is expected by March 2016, we will also know about the tentative cost of the project. The government will then sign a grant assistance with China and the Chinese government will award the contract for the construction of ICD in Timure on a turn-key basis.