While the country was busy with elections, there were some major developments in India-Nepal trade relations.
First, the containerised rail cargo carrying third-country imports of Nepal through the Indian ports of Kolkata and Vizag will no longer require clearance by Indian Customs authorities as both ports have introduced the electronic cargo tracking system (ECTS).
The ECTS is an electronic seal that, unless tampered with, ensures free movement of the container through the international border.
The system has already been introduced at Vizag port in line with a project undertaken by the Asian Development Bank (ADB) and was introduced by Kolkata port a few months ago.
The electronic cargo system at Kolkata now does away with Indian Customs’ check of Nepal’s third-country imports.
Nepal had for long been resisting checks by Indian Customs of its third-country imports, while the Customs authorities had defended the move, citing the prospect of diversion of cargo.
Road cargo movement
With rail movement of containers easing up, Kolkata port authorities are planning to introduce ECTS for road movement of containers, in phases. While Vizag doesn’t have any road cargo for Nepal, a large section of the third-country container imports through Kolkata take the road.
Meanwhile, the transition to ECTS has resulted in a shift of cargo from Kolkata port to Vizag. According to sources in the Container Corporation of India (Concor), till two months ago, 70 per cent of the Nepal-bound container cargo was through Kolkata port.
The ratio reversed over the last two months as Kolkata port now handles 30 per cent of the Nepal-bound container cargo. The rest went to Vizag.
According to sources, this is because of increase in costs while operating through Kolkata due to imposition of high handling charges by the shipping lines vis-à-vis Vizag, which enjoys the advantage of lower ocean freight.
Coal handling improves
But Kolkata port authorities are confident of bouncing back. According to Chairman Vinit Kumar, over the last year, the port has taken a number of measures to ease the movement of Nepal-bound cargo.
The most important of such steps was handling of coal at Kolkata dock system. Kolkata port has two dock systems and bulk cargo is normally handled by the Haldia dock system. Low rake availability and inadequacies in handling led to a pile-up of coal cargo at Haldia.
The problem has been resolved as Kolkata shared the burden and rake handling ratio improved substantially.