With end in sight to Madhesi stir, India-Nepal trade coming back to normal

India-Nepal trade may soon be back to normal as Madhesi parties appear set to end the five-month-long economic blockade at Birgunj (Nepal)-Raxaul (India), the key trading gate . A decision is expected at the meeting of the four-party Madhesi Morcha this week.

The gate handles nearly two-thirds of Nepal’s nearly $8-billion (2013) foreign trade. Nearly 60 per cent of the trade is with India and the rest (third country trade) is routed through Kolkata port.

“The blockade was imposed to pressure the government. But, the strategy backfired. While the government didn’t yield to our demands, common people suffered due to shortage of essentials and livelihood impact. On the flipside, it encouraged black marketing of essentials,” Rajendra Mahato, a top Madhesi leader and chairman of the Nepal Sadbhavana Party, told BusinessLine.

“The Morcha will meet this week to finalise the future modalities of the movement. But, we want either all the trading routes be closed or Birgunj be open,” he said.

Ground reports suggest that a sharp waning of public support for the agitation forced the Morcha to allow movement of goods at night. “I was there last night. Goods were moving freely in handcarts or small commercial vehicles. You can say unofficially, the blockade is withdrawn,” said Kanchan Jha, a Terai-based journalist.

GP Lath, who owns a textile mill, a rice mill and confectionaries manufacturing facilities in Nepal’s industrial hub Birgunj, said the inland container depot run by a Container Corporation joint venture is operating at full swing. The depot is connected to Kolkata. Lath said his large import consignments are being routed through other gates, which are seeing above-normal activity.

Shiv Shankar Agarwal, president of the industries association at Biratnagar, the No 2 commercial hub, said normalcy was returning. He is already looking for export orders for his plastic products.

Movement of petro products has picked up through gates other than Birgunj. According to latest reports, petrol and diesel supplies to the Himalayan kingdom are nearly 50 per cent of normal. LPG supplies are at 40 per cent of the usual level. ATF supplies are languishing at 15-20 per cent of normal as Nepal Oil (NOC) has failed to muster requisite number of vehicles. As per the contract with IndianOil, Nepal uses its own vehicles to lift ATF.

Clearing agents at the Kolkata Port also confirm rising activity, after nearly five months. Cargo movement, they say, would be up if Nepal resolves the issue of paying demurrages and penalties to the shipping lines and port authorities. These charges accrued when Nepalese importers could not lift consignments at the peak of the agitation. Nepalese businessmen want Kathmandu to offer import duty waiver on such payments. But, Kathmandu is yet to take a call. Non-payment of past dues has led to shipping lines rejecting Nepalese cargo.

COMMENT NOW