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Santanu Sanyal

India will open a rail link to landlocked Nepal from the port of Kolkata. The first train will roll into Sirsiya by April next year Mountainous Nepal does not have a railway network, except a small stretch set up by the British 66 years ago for movement of timber.

AN IMPORTANT development in the country's bilateral trade has virtually gone unnoticed. On November 7 in Kathmandu, India and Nepal signed a bilateral agreement on railways to facilitate the operation of the multi-million dollar inland container depot at Sirsiya, near Nepal's business hub of Birgunj, close to the border with India.

The agreement, inked by India's Ambassador to Nepal and the Nepalese Commerce Secretary, clears the transportation of goods by trains between the two countries. According to the agreement, India will open a rail link to landlocked Nepal from the port of Kolkata. The first train will roll into Sirsiya by April next year after a terminal operator takes over the management of the ICD. Mountainous Nepal does not have a railway network, except a small stretch set up by the British 66 years ago for movement of timber.

The landlocked Nepal uses the Kolkata port for imports and exports — in fact, more imports than exports. The imports unloaded at the port are largely transported by road to Nepalese destinations. The same is true about exports. In 2002-03, the Kolkata port handled a total of 693,544 tonnes of Nepalese cargo, both imports and exports. Of this, the Kolkata Dock System (KDS) handled 331,021 tonnes and the Haldia Dock Complex (HDC) 362,523 tonnes. During the year, the container throughputs were: Imports 25,418 TEUs (KDS 14,801 and HDC 10,617 TEUs) and exports 1851 TEUs (KDS 349 TEUs and HDC 1502 TEUs).

In the first six months of current financial year, KDS handled 153,886 tonnes as compared to 174,441 tonnes in the same period of the last year, thus registering a drop, and HDC 172,188 tonnes (170,499 tonnes), thus posting a marginal rise. During the same period, the container throughputs were : imports 7,330 TEUs (8076 TEUS) in KDS and 7,017 TEUs (5086 TEUs) in HDC and exports: 164 TEUs (169 TEUs) in KDS and 1,111 TEUs (715 TEUs ) in HDC.

The rail transportation of the goods has been negligible so far. More than 90 per cent of the traffic handled by the Kolkata port for Nepal continues to be moved by roadways. The road lobby in both the countries being very powerful and its long hand stretching up to the right places, it has therefore not not been easy to push through the railway link concept. Earlier attempts, first in the mid-1990s and again a couple of years ago, to move containers by rail to Nepal failed. However, a beginning in rail transportation was made in August this year when the Kolkata Port Trust upgraded the railway network within the KDS making its container terminals accessible by rail from any ICD in the country.

The port authorities also drastically slashed the rates for rail-borne containerised traffic through KDS. Since then, there has been some movement of containers by rail — 70 TEUs in four rakes in August, 314 TEUs in seven rakes in September, the same number of boxes in six rakes in October and 62 TEUs in two rakes so far in the current month. The throughputs would have been more but for the limitation in terminal handling operation at Raxaul where only one siding with a goods shed has been set aside for handling containers. It is not a full-fledged container-handling terminal.

At present, the Nepal bound containers by rail are loaded at KDS and unloaded at Raxaul, the last railway point on the Indian side of the border. At Raxaul, the containers are unloaded from railway flats and put on trucks for transportation into Nepalese territory. From April, this transshipment operation will be rendered redundant. The trains carrying containers from KDS for Nepal, on completing the 800-km journey in 36 hours, (against six-seven days taken by road) will move straight into the ICD at Sirsiya and will thus reduce transport costs by $16.2 million annually, according to one estimate.

The November 7 agreement therefore is being viewed as a major development which, if implemented properly, will greatly ease the transit problems and help boost trade.

The ICD at Sirsiya has been set up at a cost of more than $10 million provided by the World Bank. Although it was ready three years ago, it remained idle because India and Nepal failed to reach agreement on how to operate the two-year old Raxaul-Sirsiya railway line which has been funded by India (Rs 17crore). On November 7, the two countries agreed to run trains on the 5.3-km long track between Sirsiya and Raxaul from where trains can travel to the Kolkata port.

However, two steps are urgently needed before freight movement between Kolkata port and the Sirsiya ICD starts on a regular basis in April. First, the appointment of a terminal operator. More than half a dozen firms such as Container Corporation of India, Central Warehousing Corporation, Dooars Transport, T. P. Roychowdhury & Co, Intermodal Logistics, Trans India, Shipping Nepal, a Nepalese firm, and Trico Maritime, a Sri Lankan firm, have bid for the job. The technical bids have been opened. After shortlisting, price bids will be invited. Hopefully, the exercise will be over and the operator appointed within the next couple of months.

Next, proper Customs procedures have to be in place. Right now the document flow procedures in the Customs is quite complex as the documents are required to pass through the same department twice or thrice. Many times, the documents are entered in the Register at land customs stations in Nepal border without the consignments having reached there.

It is therefore felt that the Customs transit document that is submitted to the Nepalese Customs must be noted and the goods immediately appraised and cleared. This will reduce the time to be taken for clearance. The transit time should be made uniform for all transporters and the documents and physical transfer of goods must take place simultaneously.

One thing has to be remembered: For both Nepal-bound imports and Nepalese exports to other countries through Kolkata port, India is a third country offering only the transit facility. The Indian Customs, therefore, must act accordingly.

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