KATHMANDU, JUNE 29
The World Bank has approved $1.03 billion of financing to help improve regional trade in Nepal and Bangladesh by reducing trade and transport costs and transit time along the regional corridors.
The Accelerating Transport and Trade Connectivity in Eastern South Asia (AC- CESS) Programme Phase 1 will help the respective governments address the key barriers to regional trade - manual and paper-based trade processes, inadequate transport and trade infrastructure, and restrictive trade and transport regulations and processes.
The Phase 1 programme will help replace lengthy manual and paper-based trade processes with digitised automated solutions in Nepal and Bangladesh. The automation will enable faster border crossing times and instal electronic tracking of truck entry and exit, electronic queuing, smart parking, and CCTV cameras. The programme will also help improve selected road corridors and upgrade key land ports and custom infrastructure, while ensuring green and climate-resilient construction.
This will help the integration of landlocked Nepal and Bhutan with the gateway countries of Bangladesh and India.
"Regional trade offers enormous untapped potential for the countries of South Asia. Today, regional trade accounts for only five per cent of South Asia's total trade, while in East Asia it accounts for 50 per cent," said Hartwig Schafer, World Bank vice-president for South Asia. "South Asia can boost economic growth significantly and create opportunities for millions of people by increasing regional trade and connectivity."
The $275 million ACCESS Project in Nepal will upgrade 69 km two-lane section of Butwal-Gorusinghe-Chanauta road along the East-West Highway to a climate-resilient four-lane highway, with a focus on ensuring better road safety.
This is expected to reduce travel time by 30 per cent, thus providing better access to India's western seaports.
The project will construct at least three market areas along the highway with dedicated areas for women entrepreneurs and traders to ensure that women can benefit from the enhanced economic opportunities.
The market areas will be equipped with separate toilets for women, free wi-fi, and digital bulletin boards with timely trade and market information. It will also support capacity building to enhance trade and customs processes at Birgunj and Bhairahawa border points.
The project will also help advance Nepal's preparedness and subsequent implementation of the Motor Vehicle Agreement (MVA).
"Nepal has large untapped potential for regional trade and exports. Low regional trade is often a result of the high cost of connectivity," said Faris Hadad-Zervos, World Bank country director for Nepal, Maldives and Sri Lanka. "The project will help unlock Nepal's economic potential through better connectivity and trade, both between the provinces as well as regionally among Nepal and other countries to support a green, resilient, and inclusive development."
"It is highly critical to ensure trade growth, long-term sustainability and resilience of investments, while minimising actual degradations on the environment, wildlife and ecosystems along Nepal's road network, which carries 90 per cent of passengers and goods movement," said Oceane Keou, World Bank task team leader of Nepal project and co-task team leader of programme.
"The project will adopt and implement an innovative green and resilient highway corridor concept in Nepal, based on a landscape-level development approach."
Meanwhile, the $753.45 million financing for the AC- CESS Project in Bangladesh will upgrade the 43 km section of the two-lane Sylhet-Charkai-Sheola to a climate-resilient four-lane road, connecting the Sheola Land Port with the Dhaka-Sylhet Highway. This will cut down travel time by 30 per cent. The project will support digital systems, infrastructure, and more streamlined processes at Benapole, Bhomra, and Burimari land ports, the three largest land ports in Bangladesh handling approximately 80 per cent of land-based trade. It will also support the modernisation of the Chattogram customs house which handles 90 per cent of all import/export declarations in Bangladesh.
"While the trade between Bangladesh, Bhutan, India, and Nepal grew six times from 2015 to 2019, the unexploited potential for regional trade is estimated at 93 per cent for Bangladesh," said Mercy Tembon, World Bank country director for Bangladesh and Bhutan. "The project will help Bangladesh improve regional trade and transport and automation of processes will build resilience to crises like the COV- ID-19 pandemic."
In the second phase, the programme will include Bhutan.
"A key focus of ACCESS programme is to support solutions that can most effectively reduce dwell times at trade gateways, which is vital to lowering trade costs. This entails greater border cooperation and coordination within and between countries, cutting down the physical inspection of goods, and simplifying regulations and processes," said Erik Nora, World Bank task team leader of the programme.
A version of this article appears in the print on June 30, 2022, of The Himalayan Times.
