Nepal to ferry cargo vessels on the Ganges

Nepal and India today finalised the operation modality for allowing Nepal to operate its cargo vessels on three inland waterways of India paving the way for Nepal to ferry its cargo vessels with its flag.
Concluding the two-day Nepal-India Transit Treaty Review meeting in Kathmandu today, India agreed to allow operation of Nepali vessels on the Ganges River that runs parallel of Nepal’s southern border, according to a press note issued by the Ministry of Industry, Commerce and Supplies.
According to spokesperson of the ministry Navaraj Dhakal, the two countries signed the standard of procedures during the joint secretary level bilateral meeting. “Once the provision come into effect, Nepal can ferry any suitable size cargo vessels along the prescribed water routes,” he said, adding that Nepal has been seeking to use three inland waterways on Ganges River that include the Kolkata-Kalughat-Raxaul, Kolkata-Sahebgunj-Biratnagar, and Kolkata-Varanasi-Raxaul routes. “India has developed a waterway on the Ganges River, connecting Varanasi and the seaport of Haldiya, Kolkata.”
By utilising these water routes Nepal can expand its transit options to the sea to carry out the third country trade,” said Dhakal, who led the Nepali team, whereas joint secretary of the Department of Commerce at the Indian Ministry of Commerce and Industry Bhupinder Singh Bhalla led the Indian delegation in the bilateral meeting.
“The Indian authority at the meeting expressed commitment to start groundwork to start trade via these waterway routes as soon as the two governments ink agreement on the new and modified Transit Treaty,” he said, adding that the Indian authority has said Delhi will allow Nepal to use ships of maximum capacity as per feasibility in the finalised waterway routes.
Nepal and India are revising the transit treaty – that was revisited by two countries earlier in 1999 – in almost two decades. “Only small amendments were made to some clauses of the treaty over the time,” the press note from the ministry reads, adding that the treaty will be automatically renewed from January 5, 2020 till 2027.
Likewise, the meeting has also finalised two new routes for bulk cargo transportation. According to the existing provision, bulk cargo is allowed to enter only from Raxaul (Birgunj) but the two sides have agreed to allow bulk cargo movement to Nepal also from Jogbani (Biratnagar) and Nautanwa (Bhairahawa), the press note reads. “The technical teams of two countries also signed agreement to allow Nepal to use railway-based transportation of bulk cargo from Kolkata and Vishakhapatnam seaports of India to Jogbani and Nautanwa near Nepal-India border.”
Along with the provision, the Indian side has also agreed to allow Nepal to carry out transshipment service via the electronic cargo tracking system (ECTS) in transit routes other than Vishakhapatnam-Birgunj. At present, only Nepal-bound cargo released from Vishakhapatnam port are permitted to use ECTS under the transshipment facility. “The provision is in pilot implementation for cargo brought via Kolkata port,” the press note reads.
The multimodal facilities are expected to help reduce transit costs and make Nepali products more competitive in the international market. However, the provisions will come into effect once the revised treaty is signed at the higher level.
Dhakal also informed that the two sides also discussed on Nepal’s proposal to use two Indian seaports – Dhamra in Odisha and Mundra in Gujarat – for third-country trade. “But India will first carry out detailed feasibility before deciding whether to let allow use to use these ports to Nepal.”

India to allow Nepal to use three inland waterways

Nepal is likely to get access to more ports of India for overseas trade as India may allow Nepal to use inland waterways in three routes and movement of bulk cargos via railway from Indian seaports to major Nepal-India border points.
“India has expressed its consent during Nepal-India Transit Treaty Review meeting that kicked off in Kathmandu today,” according to a press note from Ministry of Industry, Commerce and Supplies.
The government teams from both the countries discussed various issues relating to simplifying Nepal’s transit routes via India. The bilateral meeting will conclude on Wednesday.
Nepal has been seeking to use three inland waterways – Kolkata-Kalughat-Raxaul, Kolkata-Sahebgunj-Biratnagar, and Kolkata-Varanasi-Raxaul routes – on Ganges River expanding its transit options to the sea.
During the talks in New Delhi last October, the Indian side had agreed on principle to allow Nepal to use these inland waterways. India has developed a waterway on the Ganges River connecting Varanasi and the seaport of Haldiya in Kolkata. Access to the Indian waterways is expected to facilitate efficient movement of cargo imported from third countries to Nepal.
According to the joint secretary of Ministry of Industry, Commerce and Supplies Nabaraj Dhakal, India is also positive toward facilitating railway-based transportation of bulk cargo from Kolkata and Vishakhapatnam seaports of India to Jogwani and Nautanwa, Sunauli, at the Nepal-India border. “Bulk cargo includes fertilizers, sugar, soybean, salt, animal feed and raw plastic materials among others,” he said, adding that the bulk cargo items currently brought from third countries via Kolkata, Haldiya and Vishakhapatnam ports are imported to Nepal only through Birgunj border point. “Nepal at present has been using West Bengal’s Kolkata and Haldiya ports as well as Visakhapatnam Port of Andhra Pradesh.”
Dhakal is leading the Nepali team whereas joint secretary of the Department of Commerce at the Indian Ministry of Commerce and Industry Bhupinder Singh Bhalla is leading the Indian delegation.
The two countries might ink the deal tomorrow, if everything goes smoothly.
According to former joint secretary at the Ministry of Industry, Commerce and Supplies Ravi Shankar Sainju, the use of additional ports will facilitate Nepal’s overseas trade. “Dhamra Port of Orissa can be an alternative to the infrastructural hurdles at Kolkata Port and the long distance to Visakhapatnam Port,” the government officials opined, adding that Dhamra Port is 1806-km from Nepal’s Krishnanagar. “This new port is 400-km near than Visakhapatnam Port and 300-km near than Kolkata.”
Dhamra Port, which is operated by private sector, provides modern facilities and can accommodate up to 25,000 metric tonnes of goods.
Traders believe this port would be useful for the bulk of Nepal-bound goods from third countries. According to traders, Nepali importers can benefit from Mundra Port of Gujrat as well since it is connected to railway network right up to Krishnanagar.
They have long been demanding to allow diversifying the bulk cargo transport as it often takes more than a month for bulk cargos to reach Birgunj due to various hassles. Citing a lack of railway infrastructure, India had been saying that it was difficult to provide bulk cargo facility at other border points.
In 2012, the Nepal-India Inter-government Committee had agreed to expand the bulk cargo facility to Biratnagar and Bhairahawa border points. The agreement, however, was not implemented as the letter of exchange was not issued.

Nepal, India agree to review trade treaty

Nepal and India today agreed to review the bilateral trade treaty.
During the two-day commerce joint secretary level-talks that ended today, both sides agreed to review issues related to bilateral trade and commerce.
According to minister for Industry, Commerce and Supplies Matrika Yadav, both the nations have agreed to take steps like comprehensive review of the existing bilateral trade treaty, to further boost two-way commerce. “The bilateral talks focused on enhanced cooperation to stop unauthorised trade in both nations,” he said, adding that officials of the two countries sat down for the third round of talks to review the bilateral treaty of trade in New Delhi on Thursday and Friday. “The talk is expected to prepare groundwork and other provisions to review the trade treaty.”
The nine-member committee – led by joint secretary at the Ministry of Industry, Commerce and Supplies Nabaraj Dhakal – comprised of representatives from the Ministry of Foreign Affairs, Department of Customs and Ministry of Agriculture and Livestock Development had left for New Delhi on Thursday to hold talks with joint secretary of the Department of Commerce under Ministry of Commerce and Industry of the Government of India Bhupinder Singh Bhalla led Indian delegation at the joint secretary-level meeting. “Nepal and India also finalised the draft of a mutual recognition agreement in the trade of agricultural goods,” he said, adding that after the agreement goes into effect, the two countries will recognise the quality certificates issued by each other.
The ministry has informed that officials also discussed on possible ways to address Nepal’s ballooning trade deficit with India and introduce and amend provisions in the trade treaty to ease bilateral trade.  Meanwhile, it has been agreed upon to include possible concerns raised by both Nepal and India in the revised treaty.
“India has agreed to address Nepal’s concerns related to simplifying trade with the southern neighbour by addressing both tariff and non-tariff barriers,” Yadav said, adding that he would, however, disclose the details of the agreement after the negotiating team submits its report to him. “The meeting also was positive on addressing Nepal’s agenda to drop the zero-tariff facility on Indian agricultural goods and some other primary products.”
Earlier, officials from both the nations had held two meetings on reviewing the bilateral trade treaty in New Delhi on August 9 last year and in Pokhara on February 7 and 8.
Likewise, the February 8 meeting in Pokhara had agreed to declare inland waterways as ‘trade route’ in Nepal-India Trade Treaty. India has principally agreed to allow landlocked Nepal to use three inland waterways, which will help expand Nepal’s transit options to the sea. “Nepal can even operate its own vessels on the Ganges River that runs parallel to the southern border.”
A draft of the letter of exchange on the inland waterways was finalised during the bilateral trade talks,” Dhakal informed.
Nepal and India had issued a joint statement on establishing new connectivity through inland waterways during Prime Minister KP Sharma Oli’s visit to New Delhi in April 2018. Earlier, India has also consented to grant access to the Kolkata-Kalughat, Raxaul; Kolkata-Sahebgunj, Biratnagar and Kolkata-Varanasi-Raxaul routes during the trade talks.
Last March, the two countries formed a joint technical team to study the possibility of operating waterway transportation over various routes. The technical team identified the three routes via Haldia port as the most viable routes for inland waterway transportation between the two countries.
India has developed a waterway on the Ganges River connecting Varanasi and the seaport of Haldia, Kolkata. Access to the Indian waterways will facilitate efficient movement of cargo imported from third countries to Nepal, though the idea seems too far fetched despite Prime Minister KP Sharma Oli’s dream of ferrying ship in Nepal.
The provision could get legitimacy, after it is signed at the next Inter-Governmental Committee meeting.
India currently grants duty-free access to Nepali products with at least 30 per cent value addition. “India has agreed in principle to implement policy considering Nepali products from the customs tariff headings to the customs tariff subheadings, ensuring flexibility in the goods imported from Nepal,” the ministry informed. “Revising duty-free access for agricultural goods, revising the agriculture reform fee imposed by Nepal on Indian farm products, and removing Indian quotas on four Nepali products were among the major items on the agenda.”
Nepal has been asking India to lift the quantitative restriction on the import of acrylic yarn, copper utensils, vegetable ghee and zinc oxide, which has been in place since 2002.

Experts emphasis inland waterways for trade

Experts emphasised on the need to promote navigational usage of inland waterways in the Ganga and Brahmaputra river basins for swifter and easier trade, and also called for establishing of an institution to govern water transport in Nepal to develop navigation as an alternative mode of transport here.
Speaking at a National Policy Dialogue on ‘Promoting Navigational Usage of Inland Waterways in Ganga and Brahmaputra Basins’ here today, they said such an institution could look into the viability and prospects of inland waterways for trans-boundary connectivity, and Nepal can reap the benefits by getting linked through water with Bangladesh and India via the Ganges river basin as both these countries have a functional inland water transport system.
Organised by South Asia Watch on Trade, Economics and Environment (SAWTEE), the meeting also unveiled a study report on prospects of inland waterways in Nepal apart from discussing on prospects of navigation. They also recommended on expanding tradable benefits of trans-boundary water and on prospects of inland waterways in Nepal to Ganga and Brahmaputra river basins from Nepal’s Koshi river basin and Gandak river basin, where water transport is currently limited to boats used for river crossing.
"By getting linked to the Ganges River through inland waterways, Nepal can get access to Haldia port," the study report reads, adding that the waterway access will facilitate domestic trade and bring down trading cost. "The cost of freight per tonne per kilometre is around Rs 2.26 by railways, whereas the cost to transport the same cargo over the same distance via road shoots up to Rs 4.1, while it would cost only Rs 1.7 through inland waterways."
Addressing the panel, executive chairman of SAWTEE Posh Raj Pandey said that the government should undertake a comprehensive feasibility study of rivers to assess navigability and identify sites for possibility of upgrading existing traditional boats. "The study shows that there is prospect of inland waterways that can be promoted for navigational usage," he said, adding that the government should, however, form laws and guidelines to regulate inland waterways and define the socio-economic and environmental impact of inland waterways.
He also urged policy-makers to take advantage of India’s aggressive push into inland waterways by developing navigation within Nepal so that Nepal could be ready to access the high seas through the waterways.
Former secretary of the then Ministry of Water Resources Dwarika Nath Dhungel and joint secretary at Water and Energy Commission Secretariat under Ministry of Energy (MoE) Madhav Belbase, on the occasion, said that a comprehensive study by the government on inland waterways and its prospect for navigational usage has to be carried out.
Dhungel, also an expert on water resources, said that some attempts had been made two decades ago to develop a multi-modal transport system to connect the hilly areas. "But impetus on road construction had diverted the focus to developing only surface transport," he said, adding that a study was needed to gauge how complementary water transport would be to surface transport, especially in terms of long-haul transport.
"Promoting domestic inland waterways for navigational usage is not so easy," Belbase said, adding that a separate institution has to be formed to study the prospects of inland waterways in Nepal and its benefits in the country’s trade. "Nepal’s water resources is dependent on rain during the four months of monsoon," he said, adding, “If we were to consider commercial navigation, then maintaining of the depth and the channel would be crucial. So without constructing dams, we cannot expect to develop a waterway."
Informing that any type of additional mode of transport is a boon to every sector in Nepal former president of Freight Forwarders’ Association of Nepal Rajan Sharma urged the government to play a proactive role in identifying prospects of linking inland waterways to international trade. "Water transport was considered to be the cheapest form of transport but cost of insurance and liabilities coverage, and of cargo handling at harbors added to the cost of trading," he said, adding that considering the cost of transporting cargos through river for landlocked countries like Nepal, the cost of freight movement depends on the transit providing country as well.
On the occasion, executive director of the Institute for Social and Environmental Transition (ISET-Nepal) Ajay Dixit said domination of political economy of automobile and surface transport in Nepal had stunted development of alternative modes of transport. He also said that commercial navigation may be possible in the lower stretches of large rivers. "But it would require massive river engineering, be it constructing embankments or canalising the river,” he added.
Likewise, a research officer at SAWTEE Dikshya Singh said a comprehensive feasibility study of the rivers to assess navigability, the upgrading of existing traditional boating services at the rivers, and identifying the possibility of multi-modal transport system internally would be the first steps that should be taken to develop water navigational services in Nepal.

Spectre of water problems in South Asia

International Watercourses law and Its Application in South Asia, – a book by Dr Trilochan Upreti, a bureaucrat – has tried to present the spectre of water problems in South Asia and the possible way out, keeping in focus the international water laws.
The book is a must-read, particularly for the people of Nepal, which is blessed with huge gorges, where high dams can be built and large bodies of water can be stored for electricity generation and irrigation.
Despite such resources, it is a pity that large tracts of land in Nepal's Terai cannot be harvested due to lack of enough water. Electricity still continues to be considered a luxury, as electricity tariff is still expensive in the region.
Nepal has everything that nature can give to a nation to be prosperous. But an abject dearth of innovation and technology has crippled these advantages.
Absence of funds and myopic regional and national politics have kept these potential sources of cheap electricity mired in controversies. The significance of water resources of Nepal has immense potential for the prosperity of the country as well as its neighbours, writes the author.
The author suggests the concept of equitable utilisation of shared natural resources between neighbours. He has quoted judgments from the International Court of Justice and many international treaties on water sharing like Colombia River Treaty – between the USA and Canada to support his thesis. The equitable utilisation of resources for the rivers of Nepal that flows across India is important, he writes. And the Koshi Agreement (1954) and Gandak Agreement (1959), which have haunted Nepali psyche till date, do not adhere to international law and justice.
Nepal's failure in milking its huge water resources and a debilitating tendency of injecting politics into the issues has done no good so far. The integrated treaty on sharing of Mahakali River (1996) is much more controversial than Koshi and Gandak Agreement.
The author is cautious that past faults in water treaties should not be repeated. He quotes international laws of Norms of Equity, Articles 5 and 6 of UNCIW, to prove his points. However, he writes, the best way to resolve water conflicts is by negotiation rather than judicial settlement, in line with a liberal approach of equity.
The writer suggests regional and international co-operation to attain the maximum benefit of riparian states. The cloud of distrust can be converted into prosperity, he writes.
All it needs is more open discussion, as water politics in South Asia hold no more hidden agendas. India has constructed a network of reservoirs and dams along the Indo-Nepal border without giving prior notice to Nepal that has inundated huge Nepali territories. It is a flagrant breach of International Water Law, Article 7 (No Harm Rule), states the book.
The author has also given some insights on India's ambitious river-linking project, which needs to be studied in detail. More in-depth study on the threat from such a river-linking project to Nepal is needed. As the project might hurt other countries also, their involvement in discussions is also important.
Each basin state is entitled within its territory to get reasonable and equitable share of water on international drainage basin, according to the Helsinki Rules. The book also peeps into the Mekong Basin and Southern African states concept of regional grids in the trade of hydroelectricity for investment of multinational agencies, which could be a lesson for Nepal.
Although the book is a giant step forward in understanding the significance of Nepal's treaties and their application in line with international laws, it would have been better, if the book had more practical suggestions on water sharing between India and Nepal.

BOOK REVIEW
Book: International Watercourses Law and Its Application in South Asia
Author: Dr Trilochan Upreti
Published by: Padam Siwakoti for Pairavi Pakistan
Pages: 367
Prices: Rs 1,000 (Hard cover)/Rs 600 (Soft cover)