India-Nepal trade takes a hit

India-Nepal trade, which has been at 60-70 per cent below normal for the past five months, may remain subdued for some more time, as the crisis in the Himalayan country has deepened following the recent Constitutional amendments.

India recorded $5.19 billion in export-led trade with Nepal in 2014-15, against $4.55 billion in the previous fiscal. But the five-month-long agitation has dented the volume substantially this fiscal.

While the fine-print of the Constitutional amendments are not available, analysts and the four-member Madhesi forum have described them as “cosmetic”.

The KP Oli government in Kathmandu, on the other hand, claims that the amendments address at least one major Madhesi demand — proportional representation in Parliament.

Sources say Delhi too was keen that the Oli government address at least some of the Madhesi demands, to placate protestors who have blocked the main trade route through Birgunj in the southern plains of Nepal.

But, instead of soothing frayed nerves, the amendments seem to have inflamed anger in Madhesi youth, making it difficult for the leadership to lessen the agitation.

The trouble was further fuelled by police firing on agitators killing three, on January 21, just when the Nepali Prime Minister was in peace talks with Madhesi leaders.

“It is doubtful if the government is keen to see the issue resolved, as they resort to violence at the wrong moment. It destroys the environment for peace talks,” said Rajendra Mahato, a top Madhesi leader and chairman of the Nepal Sadbhavana Party.

Analysts don’t see immediate peace in the country.

“The movement has reached a critical juncture. People are tired and frustrated with the leadership. But, a slightest provocation from the government may turn the situation volatile,” said a local journalist.

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