Nepal’s Dream to expand its Transit Options


Nepal-India-China waterways

Nepal being a landlocked country does not have multiple transit options to the sea and depends on its neighboring countries China and India for any waterways transport. In a meeting with Nepal’s Joint Secretary of the Ministry of Industry, Commerce, and Supplies and India’s Joint Secretary of the Department of Commerce, Ministry of Commerce and Industry held later in the month of November, the countries are expected to review the existing Transit Treaty by incorporating inland waterways through three routes.[1]

Last year, a joint technical team was formed to study the possibility of operating waterways transport. The team identified three routes that would be most feasible for transportation between the two countries. It was discussed that Nepal should be granted access to three inland waterways: Kolkata-Kalughat-Raxaul; Kolkata-Sahebgunj-Biratnagar; and Kolkata-Varanasi-Raxaul.[2]

“Agreement to allow Nepal to use these routes for inland waterways transportation will add a new dimension to Nepal-India bilateral trade and the country’s third-country trade via India,” informed Nabaraj Dhakal, joint secretary at the Ministry of Industry, Commerce, and Supplies. Taking cognizance of Nepal and India’s geography, the two Prime Ministers took the landmark decision to develop the inland waterways for the movement of cargo within the framework of trade and transit arrangements, providing additional access to the sea for Nepal. India has also expressed commitment and that the trade will begin as soon as the treaty will be modified. Nepal can even operate its own vessels on the Ganges River that runs parallel to the southern border. Governments of India and Nepal have declared that Kosi and Gandak would be developed as international Indo-Nepal waterways.[3]

Currently, Nepal is solely dependent on road transport facilities, and developing waterways will diversify the transit facilities of a landlocked country. But the question remains whether these inland waterways are beneficial and feasible for Nepal.

Access to the Indian waterways is expected to facilitate the efficient movement of cargo imported from third countries to Nepal. This trade agreement will reduce the transportation cost of imported goods. This reduced cost, in turn, will encourage healthy domestic market competition and, in the long run, will promote export from Nepal.

The entry capacity of Kosi into the Ganges is near the extreme tail end of the river. As a result, the Ganges river channel is quite deep on this stretch allowing large river vessels into this waterway. At present, the containers that deliver to Nepal weigh around 20 tons each. If a vessel with 1000-ton capacity is operated on the Gandaki River, it can ship 50 such containers at a time.[4] There was an increase in the water depth after the completion of Farakka Barrage. The proposal was to build two canals through this route. These require navigating locks due to large drops. It was also mentioned that the drops at this entire 270-km stretch could be used for power generation. The canal will then be adequate for 1500-ton capacity vessels.[5] The width of the canal would have to be around 80m-100m. The infrastructure should comply with that of the Farakka Barrage. The minimum depth of the canal is 4m whereas the minimum depth at the sill will have to be maintained at about 3.5 meters.[6]

The planned capacity of ships/cargo vessels on waterways proposed on Kosi and Gandak was relatively small (100-ton capacity) compared with the vessels proposed in the Ganga waterway which are up to 1500-2000-ton capacity. This capacity was proposed in the Detailed Project Reports of Kosi and Gandak waterways, which were prepared before the decision to extend these waterways to Nepal.[7] It appears that with the extension of the waterways, there are also plans to increase the tonnage of the vessels to approximately 600 tons, which in turn will also mean the need for larger channels.[8] Developing these waterways to allow large barges to transport cargo requires the creation of channels in these rivers with adequate depth and width to allow these vessels to move. This would be developed by using the process of dredging – cutting and excavating the riverbed – and/or by building barrages. Dredging also requires environmental clearance and heavy investments. It will disturb the important habitat of threatened animals like the royal Bengal tigers and one-horned rhinos along the Narayani River (Gandak) which is being considered for the project.[9] Furthermore, as noted in the past, these rivers keep shifting their channels which induce higher maintenance. In addition to this, the project will require frequent relocation of terminals and associated infrastructure.[10]

The rivers being scrutinized for the development of waterways are alternatively being used by irrigation and hydropower projects. Therefore, a detailed study needs to be conducted before the diversion.[11] However, the rivers can still be considered navigable if the minimum required depth is maintained even after the diversions. Given the huge financial outlay and serious impacts of these waterways, it is of utmost importance that the studies are completed, and extensive discussions are held involving governments, local communities, civil society, and independent experts. Until then, the work on the waterways should be put on hold.[12] They should be taken up the project only if a consensus emerges from such discussions that the waterways are found viable and desirable through such an informed and democratic process.[13]

In 2012, the Nepal-India Inter-Government Committee had planned to allow cargo transportations even through Bhairahawa and Biratnagar besides Birgunj. However, this agreement was not implemented as a letter of exchange was not issued. The meeting held at Kathmandu on November 26th and 27th also finalized this clause opening two more borders for cargo transportation and moving cargo goods.[14]

Nepal has also been seeking implementation of the Electronic Cargo Tracking System (ECTS). “Along with the provision, the Indian side has also agreed to allow Nepal to carry out trans-shipment service via the electronic cargo tracking system in transit routes other than Vishakhapatnam-Birgunj,” Dhakal said. The two countries also seemed to have discussed providing Nepal access to two Indian seaports-Dhamra (Odisha) and Mundra (Gujarat). However, according to a ministry source, India is skeptical about this.[15]

Nepal is simultaneously looking at its neighbor in the North, China, after Chinese President, Xi Jinping’s visit, and Nepal got a step closer to signing the agreement on Transit and Transportation. After the agreement comes into effect, Nepal will have access to four Chinese seaports—Tianjin, Shenzhen, Lianyungang, and Zhanjiang—and three land ports—in Lanzhou, Lhasa, and Shigatse—for third-country imports and exports. However, China is yet to confirm whether Nepal has access to these ports. One major hurdle while implementing the deal is believed to do with Nepal’s poor infrastructure. According to Nepali officials, the major drawback is the condition of Nepali roads, infrastructure, including its highways and dry ports connecting to China.[16]

Nepal will significantly benefit in terms of international trade after getting access to Indian inland waterways. However, there will be environmental degradation by the activity to be carried out viz. dredging. The wildlife will be at risk. The new trade routes appear to be a trade-off between the economy of the country and nature. The construction will require frequent relocation as mentioned earlier and, therefore, the project cannot be seen as a one-time investment for Nepal. The rivers being examined are currently being used for irrigation and hydropower and the government will need to take action in order to compensate for this. The impact on humans and wildlife cannot be disregarded as well. Conclusively, a thorough study needs to be conducted keeping in mind all the benefits and difficulties of the project before the project is taken forward to fruition.

Author: Shraddha More

Photo: Pixabay

[1] Rajesh Khanal. 2019. “India agrees to allow Nepal to use three inland waterways.” The Kathmandu Post. <>.

[2] Ibid.

[3] Sandrp. 2018. “National inland waterways in Bihar: viable or desirable?” Sandrp. <>.

[4] Gyanendra Acharya. 2019. “Inland waterways: Are Nepali waters navigable?.” South Asia Check. <>.

[5] Dr. A.B. Thapa. 2018. “Sea vessels in Nepali river ports.” Spotlight Nepal. <>.

[6] Gyanendra Acharya. 2019. “Inland waterways: Are Nepali waters navigable?” South Asia Check. <>.

[7] Sandrp. 2018. “National inland waterways in Bihar: viable or desirable?” Sandrp. <>.

[8] Shripad Dharmadhikary. 2018. “National waterways in need of a new course.” India Together. <>.

[9] Gyanendra Acharya. 2019. “Inland waterways: Are Nepali waters navigable?.” South Asia Check. <>.

[10] Sandrp. 2018. “National inland waterways in Bihar: viable or desirable?” Sandrp. <>.

[11] Gyanendra Acharya. 2019. “Inland waterways: Are Nepali waters navigable?.” South Asia Check. <>.

[12] Sandrp. 2018. “National inland waterways in Bihar: viable or desirable?” Sandrp. <>.

[13] Shripad Dharmadhikary. 2018. “National waterways in need of a new course.” India Together. <>.

[14] Sujan Dhungana. 2019. “Inland waterways operation modality finalized.” The Himalayan Times. <>

[15] Rajesh Khanal. 2019. “India agrees to allow Nepali Cargo Vessels on the Ganges.” My Republica. <>.

[16] Anil Giri. 2019. “Nepal says it is ready to implement transit deal but China has yet to respond.” The Kathmandu Post. <>.

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