India and Nepal step towards a more co-operative trade partnership

India is going soft on its former strict stand to control Nepali trade in its exclusive favour. The former has agreed to allow Nepal two additional custom import points to source bulk cargo from third party countries from across the world. Currently, Raxaul-Birgunj is the lone point wherein the imports are possible- soon, Jogbani-Biratnagar and Nautanwa-Bhairahawa custom points will add to this list.

India and Nepal are currently involved in a high level bilateral talk, and this concession has emerged as the biggest output thus far from the amicable meeting. India has also agreed to the condition that Nepal can utilise vehicles imported from third countries for the transfer of such bulk cargo. Prior to this, such imports could only use containers or wagons. The meeting also allowed Nepal to import agricultural and livestock products from India more frequently. Primarily, Nepal can now import hybrid cows from India to fulfil its dairy requirements.

This high level meeting was hosted by Indian Commerce Secretary Mr. S.S Rao, who invited over his Nepali counterpart Mr. Madhav Regmi to India for these talks. India accounts for 40% of the gross foreign investment in Nepal and both sides have agreed to enhance this figure by gradually upgrading the infrastructure to simplify bilateral trade. Starting with the removal of various technical and non-technical restraints from its end, India plans to enhance its stature as the largest foreign investor in Nepal. In the financial year 2012-13, Nepal’s bilateral trade with India amounted to just Rs. 26,126.9 Crore, a massive 66% of Nepal’s gross external trade that is still a miniscule portion of India’s overall foreign trade of $140 billion in the same duration. Surely, there is a massive scope for improvement in this regard.