Nepal seeks Mumbai as second transit point for third country trade

After Kolkata, Nepal is now seeking Mumbai as a second transit point for its cargo.

Kathmandu, Aug 23 : After Kolkata, Nepal is now seeking Mumbai as a second transit point for its cargo.

Kathmandu has already initiated talks with New Delhi for securing Mumbai's Jawaharlal Nehru Port as a transit point for third country trade.

India has agreed in principle to allow the use of the port, but has sought a rationale for doing so.

Javed Ashraff, economic counsellor at the Indian Embassy in Kathmandu, said: "We have sought a projection of cargo volume and other details from the Nepal Government."

Kathmandu has assigned the UN Trade Related Capacity Building Project to conduct a detailed study to ascertain the volume of export traffic, economic benefits and possible modalities for cargo movement, Kantipuronline quoted Purushottam Ojha, acting Secretary of Nepal's Ministry of Industry, Commerce and Supplies, as saying.

Formal negotiations will begin once both the sides have exchanged views on Nepal's proposal.

Until now, Nepal uses Kolkata as the only transit point to link its trade with third countries.

Nepal is pushing for a transit facility at Mumbai, mainly due to its geographic location and efficiency.

Nepal first requested India to provide it with the second transit point in 1995. A formal request to it was made during the then Prime Minister Sher Bahadur Deuba's visit to New Delhi in September 2004.

According to an assessment done in 1995, the use of Jawaharlal Nehru Port could reduce the transit cost of west-bound cargo by up to 40 percent and freight cost by 200 dollars per container, compared to shipment from Kolkata.

However, the assessment had not calculated how it would impact cost of inland cargo movement. The distance of JN Port from Birgunj is about 1,500 kilometers, whereas Birgunj is 700 km from Kolkata.

Nepal freight forwarders say that overall cost of trade with the US and Europe would be cheaper from Mumbai port than from Kolkata.

Number of days of shipment would be reduced by about 20 days, and private sector-operated JN port is much more efficient than the trust-managed Kolkata port, were among the reasons cited for preferring Mumbai over Kolkata.

ANI