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Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

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Page 1: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Sarad Bikram Rana

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Page 2: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Presentation Layout2

Page 3: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

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Page 4: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

South Asia

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Page 5: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Nepal's Intra SAARC Trade

In Millions $Sl. No  Import  % Export % Total  Trade%

Total   5,039  100  818  100.00 5,857  100.00Other than 

SAARC2,148  42.63  214  26.15 2,362  40.33

SAARC  2,891  57.37  604  73.85 3,495  59.67India 2,874  57.04  535  65.47 3,410  58.22Bangladesh  10  0.20  45  5.54 56  0.95Bhutan  2  0.04  21  2.55 23  0.39Pakistan 4  0.07  1  0.13 5  0.08Sri Lanka 1  0.01  1  0.16 2  0.04

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Page 6: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Trade and Transit Treaties 

• Trade Treaties–17 Countries

– SAARC: India, Bangladesh, Sri Lanka,  Pakistan

• Transit Treaty– India

–Bangladesh

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Page 7: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

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• Article XII • Treaty of Trade mainly provides for;

– Reciprocal 

arrangements 

on 

primary 

and 

agricultural  commodities,

– Preferences 

to 

Nepalese 

Manufactured 

Articles 

in 

export  to India.

– Rules of Origin Criteria.– Additional 

Preferences 

to 

SSI 

(Small 

Scale 

Industry) 

Products

– 26 LCS + 1 Airport  identified as trade corridors– Provision of Duty Refund Procedure (DRP) –

abolishment.

Treaty of Trade with India

Page 8: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit Treaty with India

• 12 Articles• Protocal to Article v 

– lease conditions for dock berth, land and  infrastructure to be provided for Nepal, 

arrangement of customs clearance licence to be  provided for Nepal, and condition for Warehouse 

management etc.

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Page 9: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit treaty with India

• Protocal to Article VI– the mutually agreed road route (i.e. 15 routes)   

connecting  Kolkatta/Haldia  with Nepal’s Border  Stations, and to  connect Indian rail head (Raxaul), 

– Provision of force majeure situation, and 

– Condition applicable for transportion of various  types of cargo.

• Memorandum to Protocol– the import and export procedure applicable for 

traffic‐in‐transit.

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Page 10: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Rail Service Agreement with India• Rail Service Agreement Signed in 2004

• Kolkatta/Haldia Ports  and Birgunj, Nepal for transit  traffic,  and Birgunj via Raxaul for bilateral traffic

• 33 clauses specifying rule, regulation and operating  modalities of railway movement, recruitment of ICD  operator, Permission of rolling stock to be 

interchanged etc.

• Anexure specifies the import and export procedure

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Page 11: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit Corridor: Kolkata Port• Road:

– Birgunj‐Kolkata Distance:  924 KM– Time required to cover the distance: 2 ‐

3 days (for cargo 

vehicle).

– Road Status: Moderate

• Rail Movement– Birgunj ‐

Kolkata: 704 KM

– Time: 3 to 4 days, one way.

– Frequency: 22 rake per month

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Page 12: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit corridor: Phulbari (India)

• Road:– Kakarvita (Nepal) via Phulbari (India) to Banglaband 

(Bangladesh)  55 KM

– Banglaband to Khulna: 713– Road Status: very congested.– Time to travel: 2 days (from Banglaband to Khulna)

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Page 13: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit Agreement with  Bangladesh• 9 Articles• Protocol with reference to Article I specifies the 

designated entry and exit points  of the Bangladesh  side for traffic‐in‐transit.

• Protocol with reference to Article IV specifies the  administrative arrangement to make available for  Nepal from the Bangladesh side.

• Protocol with reference to Article V specifies the  import and export procedure for traffic‐in‐transit.

• Protocol to the transit Agreement will also apply to the  movement of bilateral trade between Bangladesh and 

Nepal. 13

Page 14: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Trade and Payments Agreement   with Bangladesh• 11 Articles• Article II specifies the agreement of 

extending  MFN treatment in respect of – issues of licenses – customs formalities, 

– customs duties and other taxes etc

• Article IV mentions the list of goods to be  exchanged between two countries.

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Page 15: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Trade Agreement  with Pakistan

• Article 13• The Contracting Parties shall grant each 

other the MFN Treatment with respect to– customs duties and formalities, taxes, fees 

and charges of any kind levied on export and  import of goods and commodities between  

two countries.

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Page 16: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Trade Agreement  with Sri Lanka

• Article 12• The Contracting Parties agree to accord to each 

other in their trade relation treatment no less  favorable than that which is accorded to any 

other country in respect of issuance of licenses,  custom formalities, customs duties and taxes 

and other charges for the import and export of  goods and commodities.

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Page 17: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

South Asia Free Trade Area

• Elimination of barriers to trade, facilitation of cross,  border movement of goods, promotions of fair 

competition in trade, and creation of mechanism for  the implementation of the agreement and for the 

resolution of disputes.

• Trade liberalization, programme, rules of origin,  institutional arrangements, and consultations and, 

dispute settlement procedures

• Time schedule for tariff elimination within a certain  time period, there is also a clear provision for removing 

all quantitative restrictions17

Page 18: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Documentary Requirement:  Bilateral TradeMandatory Additional Total

Bangladesh 11 3 14

Bhutan 5 3 8

India 6 10 16

Pakistan 6 11 17

Nepal 7 5 12

Srilanka 8 13 21

Source: Annex to the Report of the 6th

meeting of the Sub‐group  on Customs Cooperation, SAARC, 14‐15 January 2009

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Page 19: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit issues: Kolkata Corridors

• Transshipment of Cargo takes place at Singapore or  Colombo.

• Limitation on vessels  due to draft available at Kolkatta  Port.

• No transshipment provisions from Kolkata Port to Nepalese  Border point

• Clearance process is cumbersome and time consuming

• Inefficiency of the CONCOR for container movement.

• Poor rail network.• Limited working hour at Land Customs Stations (LCS)

• High detention charges likely to every consignment.

• Charges

for

Nepal

Handling

Container

to

costly

(next

slide)19

Page 20: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

High transaction cost: Import

1 Delivery Order charges 4,963.502 Terminal Handling Charges (THC) 3,860.503 Washing/Maintenance Charges of Containers 1,500.004 Documentation charges 827.505 Lift on/Lift off charges 330.96 Survey Charges 551.507 Wharfages (Port Landing) 4,274.128 Shipping liner congestion charges 6,862.509 Final Delivery charge of vessel owner 2,206.00

10 Insurance charge (Customs) 275.0011 Shipping lIner Insurance Charges 493.0012 Container damage charges 5,000.0013 CHA's service charge 6,000.00

14Demurrage/Detention charges 223.45 daily ( for 14 days) US$ 700 Approx.

3,126.90

15Transportation charges ex Kolkata to Birgunj Nepal (THC and other charges

33,463.25

Total 73,734.67

S.N. Activities Charges involved for handling a TUE (IRs)

•1 US$ =  48 (approx.)•20 ft. containers with 20 MT. import shipment.•Cost is based from the vessel arrival to return of empty container to shipping lines yard.20

Page 21: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Transit issues ‐

Bangladesh

• Nepal and Bangladesh does not have  boarder with each other

–Has to rely with  Indian Corridors for transit  traffic

• No railway connectivity from adjoining  boarder of Nepal‐

India to India‐

Bangladesh–Has to rely with India when she laid down the 

railway track. 21

Page 22: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

• Procedure at Kakarvitta (Nepal) via Fulbari (India) to  Banglaband (Bangladesh) is cumbersome;

– Process of escorting and convoying• Requires 25 truck/tailor• Charges of the escort

– Back to Back loading• Nepalese and Indian truck not allowed to cross the border at 

Bangladeshi side and vice versa (Lifted recently)

– Labor Problem for Loading/unloading• Bangladeshi does not allow Indian labor to cross the border and vice 

versa. In this case back to back loading has been initiated. In the case  of bulk cargo, back to back loading is mostly unpractical.

Transit issues ‐

Bangladesh

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Page 23: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

– No administrative provision at Bangladeshi side• Offices like immigration and other related authorities are lacking

– No infrastructural provision at Bangladeshi side:• No CFS to:

– store perishable, vegetable– store dairy product– and other break‐bulk cargo.

– No railway  connectivity from border points to Port 

– Highways• No dedicated freight corridor• Very congested

• Out of four agreed entry point only one entry point is in  operation

Transit issues ‐

Bangladesh 

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Page 24: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

Way Forward• Treaty of Transit and RSA Revision,• Document & Procedure Simplification,

• Additional transit route and sea port.• Common Transit Declaration

• EDI use • Better Border Management

• Capacity Development of Port, Customs, 

• Multimodal transport.

Thank You Thank You  24

Page 25: Sarad Bikram Rana - ARTNeT: Asia-Pacific Research and Training …artnet.unescap.org/tid/projects/tfforum11_c3_rana.pdf · 2015-03-11 · Sarad Bikram Rana. 1. Presentation Layout.

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