India, Nepal formalises amendment of bilateral transit treaty

It will now be easier for Nepal to export third country import to another country through India as Nepal and India have formalised an amendment to a bilateral treaty to facilitate traffic in transit for goods of third country origin exported from Nepal.

The new amendment has removed restriction of movement of goods of non-Nepalis origin to transit through India for export to third countries. The amendment would also facilitate re-export of third country origin capital goods from Nepal to third countries for repair and return and also re-export of rejected goods from Nepal.

The change would facilitate Nepali business as it would allow re-export of goods imported from third countries into Nepal after some value addition in Nepal for which a legal provision was made in the Finance Act-2009.

The move would also facilitate movement of diplomatic cargo exported from Nepal and transiting through India.

In a statement today, the Indian Embassy in Kathmandu said the two neighbours have formalised an amendment to the 'Export Procedure' prescribed under the Memorandum to the Protocol to the Treaty of Transit between the two sides.

A Letter of Exchange formalising the decision has been finalised by both sides. The amendment in the provisions of the Treaty of Transit brings into effect a significant decision which was reached between the two sides during the Nepal-India Inter-Governmental Committee (IGC) meeting on Trade, Transit and Cooperation to Control Unauthorised Trade held in Kathmandu during December 21-22 last year, the statement said.

The amendment was necessitated since, according to the earlier procedure, only goods of Nepali origin were allowed to be exported through India to third countries.

The provision would facilitate Nepal's genuine third country export which may be required for re-export of goods imported into Nepal for display in fairs and exhibitions.

There are two other important trade facilitation measures which were discussed by the two sides in the last IGC meeting to allow movement of imported vehicles on their own power from Kolkata port into Nepal and facilitating the import of bulk cargo into Nepal by operationalisation of multimodal transport link from Kolkata port through Jogbani-Biratnagar and Sunauli-Bhairahawa land routes.

Proposals for making the amendments in the Treaty of Transit had been finalised by the Indian government and shared through the Indian embassy in Kathmandu with the Nepal government.

The proposals are presently under consideration of the Nepal government. Once finalised, the measures would further facilitate Nepal's transit trade through India.