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Wednesday, 11 September 2013

Nepal wants India to open two ports for overseas trade

Nepal wants India to open two ports for overseas trade

The Dhamra Port Company Ltd (DPCL) is jointly operated by Larsen & Toubro and Tata Steel. Similarly, Paradip port, which is located at the confluence of Mahanadi River and Bay of Bengal, is an artificial, deep water port on the east coast of India.
Nepal is preparing to request India to open designate two ports - Dhamra and Paradip - in Orissa for its third country trade.

The Consulate General of Nepal (CGN) in Kolkata recently suggested to the government to make diplomatic efforts for using these ports which are comparatively more efficient and cheaper in terms of cost of handling cargos compared to the Kolkata and Haldia ports.

The Dhamra Port Company Ltd (DPCL) is jointly operated by Larsen & Toubro and Tata Steel. Similarly, Paradip port, which is located at the confluence of Mahanadi River and Bay of Bengal, is an artificial, deep water port on the east coast of India. The port is administered by the Paradip Port Trust (PPT) - a wholly owned subsidiary of Indian government.

Nepal has been facing problems in handling container and non-container cargos of iron ore, coal and some minerals in Haldia and Kolkata ports which are operated by the state-owned Kolkata Port Authority (KPA).

At present, Kolkata and Haldia are the only ports which are designated for Nepal´s overseas trade by India.
To do away with the existing problems in berthing, handling and clearing the third-country imports and exports, Nepal has been looking for reliable alternative ports with good services and facilities.

According to traders, poor infrastructure and procedural hassles in Haldia and Kolkata ports make it difficult for traders to move bulk cargos. Haldia port is mainly designed for bulk cargos while Kolkata port is especially for container cargos.

In the absence alternative designated ports, Nepal´s third country cargos have to pass through Kolkata and Haldia ports regardless of where they arrive. “We won´t have to divert cargos to Kolkata or Haldia ports if alternative ports are designated for Nepal´s third-country trade by India,” a high level source at the Ministry of Commerce and Supplies (MoCS) said. “That is why we are requesting India to designate two new ports for Nepal in the upcoming bilateral meeting as per the suggestions of our mission in Kolkata.”

The Nepali mission in Kolkata recommended Dhamra and Paradip ports to the government after conducting field studies and analyzing comparative benefits.

Paradip port has been handling both container and bulk cargos, while Dhamra port, which is situated between Haldia and Paradip ports, is designed to deal with bulk cargos only.

“Both the ports are modern and mechanized compared to Kolkata and Haldia ports. This means the cost of handling cargos is far lower there,” added the official.

According to the report, Kolkata port can handle only 30,000 tons of bulk cargo per day while Paradip can handle as much as 160,000 tons a day. Similarly Dhamra port can handle up to 100,000 tons per day. But Haldia can handle only 8,000 tons a day.

The CGN´s report shows that berth charges in the Dhamra and Paradip are far lower than Kolkata and Haldia ports. Berth charges range from IRs 60 to IRs 76 per ton at Kolkata and Haldia ports. Paradip and Dhamra are charging only around IRs 30 for the same facility. Berth charge in Vishakhapatnam stands at around IRs 49 per ton.

Raxaul - the major trading point along Nepal-India border -- lies at a distance of 1,030 km from Paradeep, 746 km from Kolkata, 838 km from Haldia, 1,330 km from Vishakhapatnam and 900 km from Dhamra.

Though India has agreed in principle to allow Nepal use Vishakhapatnam port for third country trade, it has yet to be implemented as India has set a condition of imposing additional one-time lock system in the cargos heading to Nepal.

India imposed the additional one-time lock system in overseas cargos bound for Nepal through Kolkata port two years ago.

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