September 4: India has decided to allow Nepal utilize two more sea ports for overseas trade. So far, Nepal has been using three ports of India for trade with third countries while two additional ports will be allowed for foreign trade from next year.

 Indian newspaper The Print recently published a news stating that India is preparing to open access to Dhamra Port in Orissa state and Mundra port in Gujarat for Nepalese traders.

Referring to Indian diplomatic sources, The Print wrote that under India has decided to allow Nepal use these ports for import and export under its Neighbor First Policy and the two countries are in dialogue for the necessary preparations.

According to The Print, Nepal will be allowed to use the two additional ports through the revision of the Nepal-India Transit Treaty in 2023. An agreement in-principle was reached in 2018 at the Nepal-India intergovernmental meeting for Nepal to use these ports for trade with third countries.

Nepal has also submitted a draft regarding the use of these ports to the Indian authorities. This will make Nepal's foreign trade more competitive, says Ashok Kumar Temani, coordinator of the Transport Committee of Madhes chapter of the Federation of Nepalese Chamber of Trade and Industry. Temani pointed out the need for diplomatic initiatives to widen the range of port selection to reduce the transportation cost in business.

Businessmen of Nepal are currently using India's Kolkata, Haldia and Visakhapatnam ports. Due to the physical limitations of Kolkata and Haldia and the long distance of Visakhapatnam port, Dhamra port can become an alternative. Dhamra is at a distance of 300 km from Kolkata and 400 km from Visakhapatnam.

Importers opined that both Dhamra and Mundra ports operated by Adani Group, which is working on port and rail infrastructure, will help in reducing the cost of overseas trade in Nepal. Temani says that Mundra port is suitable for shipping from the western border of Nepal.

Importers say that Dhamra port is easier for Nepal than other ports for both bulk and container cargo coming from third countries. In the past few years, investment in the infrastructure and operation of container cargo in Dhamra has increased. This port is going to prepare 35 berth stations for container and bulk cargo by 2025.

Dhamra Port can be used as an alternative to the poor infrastructure of canal-based Kolkata Port and the long-distance to Visakhapatnam Port, says Ravi Shankar Sainju, former joint secretary of the Ministry of Industry, Commerce and Supplies.

Madhav Rajpal, vice president of Birgunj Merchants Association, and an importer argues that the problem of lack of trains at Haldia port will be solved after this port comes into use. Dhamra Port is only 150 km away from Haldia.