Forum (Spotlight Weekly)

Railway Linkage — Challenges and Opportunities

By Ananda B. Shrestha

The nostalgic memoir and the multi dimensional impact of transshipment of transit cargoes due to railway gauge difference between broad and meter gauge used to be unavoidable ground reality that increased the transit cost. The hassle of transshipment problem has been eased out, down the road, to a greater extent since 1995 facilitating of the most busy corridor - Raxaul / Birgunj as a part of improvement of cross border movement.

In fact, the broad gauge linkage has opened the outlet to the Raxaul transit point that shares more than 75% of total imports of the country. However, the gauge conversion associated with the low rail tariff structures also could not attract the traffic for railway services. The reasons assigned for less use might be unavailability of ample wagons at the port on the one hand and the presence of traditional operational procedures with less business like approach on the other. Consequently, the traffic in transit to the extent of 90% and more, moves by road only and the railway share seemed to be very nominal confining only to limited cargoes of road haulage restriction.

The religious, social and cultural ties existing between India and Nepal since time immemorial had also motivated for continuous economic cooperation. India has been partner in many areas and segments for economic development of the country for a long time. In this connection, different economic cooperation and Indo — Nepal transit treaty for gradual improvement of transit transport network system for traffic in transit is commendable. In addition, India seemed to have made a plan for the extension of broad gauge linkages to some of the important transit points particularly Raxaul/Birgunj, Jogbani/Biratnagar and Sunauli/Bhairahawa as a part of cross border improvements,. As such, an extension of 5.4-km. broad gauge stretch from Raxaul (India) to Birgunj (Sirsiya) Inland Clearance Depot (ICD), under economic cooperation has already been completed and just waiting for the signal of railway agreement for its operation

The direct linkages of the railway system would make the traffic in transit (containerized/break bulk) to and from port of Kolkata/ Haldia to ICD faster, safer and cheaper. The objective of the recently developed infrastructure of dry port is to reduce the transit cost by organizing railway linkage, simplified procedures and private participation. Therefore, the whole process and the objective of the proposed Railway connection to Birgunj ICD is also to adopt the commercial principle, norms and practices on its operation.

The great mission of transit cost reduction ultimately would be possible provided that necessary coordination for block trains were made under attractive freight charges maintaining the strict timetables/schedules. The operation should be reliable by clarifying the liabilities regime along with simplified documentation and procedure. All complimentary factors of trade facilitation to be applied within the country have to be improved back to back in streamlining the traffic to bring tangible outcome.

The railway operation on the eve of accession to WTO in near future would structure the traffic in transit less costly by capitalizing comparative benefits for Nepalese products through cost effective transit transportation. The railway system is also advised to introduce and encourage highly motivational package for attracting the traffic and also to overcome the competition by defusing the cartel of costly road tariff operation.

Indiaís cooperation to contiguous countries in extending support and help as a leader of the sub — continent would not only enhance its images in the international arena but also facilitate and strengthen the economic development of a small neighboring country. Similarly, the proposed rail agreement between India and Nepal possibly could provide a glaring example of interdependency for regional cooperation and development to be preceded in other sectors as well.

As such, both India and Nepal would benefit by minimizing unauthorized trade, ensuring safety, security and fast movement of traffic in transit. Consequently, it is high opportune time for India also to prove her leadership by concluding rail agreement along with the application of simplified procedure to enable long awaited infrastructure of Birgunj dry port to operate with an aim to benefit from and aspire for economic growth.

(The author is former Executive Director of Nepal Intermodal Transport Development Board)