NEPAL- CHINA TRANSIT AGREEMENT - WILL THIS END INDIAN MONOPOLY ON TRANSIT ?
WHAT JUST HAPPENED?
In 2016, Nepal and China signed the 'Transit Transport Agreement' with this - China will give access to all it's roads, rail links and Ports to Nepal to do the Trade.
Now In September 2018 - This agreement came into force (There was some timeline which not completed and agreement now in force)
Thus, Now Nepal can now do the trade with other countries via China's Port, Rail Link and Roads.
Nepal is a land-locked country. So, If Nepal wants to do Trade with other countries - Nepal can do only with Flights. [ There is no other option ]
From last so many years, India is providing the facility to Nepal to use It's roads, ports to do the Trade with other countries.
In 2015 - There came a 'Madhesis Issue' which has severely affected Nepal and its economy.
Nepal has accused India of imposing an undeclared blockade. India has denied the allegations, stating the supply shortages have been imposed by Madheshi protesters within Nepal. However, despite Indian denials, minimal border entries even from border points with no agitation fueled allegations that it was indeed an India enforced border blockade.
As a landlocked nation, Nepal imports all of its petroleum supplies from India. Roughly 300 fuel trucks enter from India on a normal day, but this has dwindled to a sporadic passage of 5–10 fuel trucks daily since the start of the crisis, though shipments of perishables like fruits and vegetables have generally been allowed to pass. Moreover, India had also been stopping some Nepalese trucks at the Kolkata harbour. The blockade choked imports of not only petroleum, but also medicines and earthquake relief material.
Due to 2015 Madhesis Strike. Prime Minister K P Oli had signed the Transit and Transportation Agreement with China in March 2016, following months-long Indian blockade at the southern border.
PROBLEM IN CHINA'S AGREEMENT
Problem is all China's Port are very far - The Nearest one from Nepal is 3000 KM in China. Whereas it's 950 KM only nearest one in India.
So, Traders will think before doing the Trade as economically for Nepal it's not viable if they use China's port.
WHY NEPAL DID THIS AGREEMENT ?
If there is any blockade in India, Then Their(Nepal) Trade not stop, atleast they have some option (though for Nepal it's very costlier) and Trade not stop. So we can say Nepal can use China's port in case of any Emergency/Blockage.
IN AGREEMENT
China agreed to allow Nepal to use four of its seaports and three land ports (or dry ports ) (where cargo's store) for third country trade reducing the landlocked country's dependency on India to conduct international commerce.
Nepal will be able to access :
The latter being the nearest seaport at a distance of around 3300 Kms from the Nepalese Border.In 2016, Nepal and China signed the 'Transit Transport Agreement' with this - China will give access to all it's roads, rail links and Ports to Nepal to do the Trade.
Now In September 2018 - This agreement came into force (There was some timeline which not completed and agreement now in force)
Thus, Now Nepal can now do the trade with other countries via China's Port, Rail Link and Roads.
Nepal is a land-locked country. So, If Nepal wants to do Trade with other countries - Nepal can do only with Flights. [ There is no other option ]
From last so many years, India is providing the facility to Nepal to use It's roads, ports to do the Trade with other countries.
In 2015 - There came a 'Madhesis Issue' which has severely affected Nepal and its economy.
Nepal has accused India of imposing an undeclared blockade. India has denied the allegations, stating the supply shortages have been imposed by Madheshi protesters within Nepal. However, despite Indian denials, minimal border entries even from border points with no agitation fueled allegations that it was indeed an India enforced border blockade.
As a landlocked nation, Nepal imports all of its petroleum supplies from India. Roughly 300 fuel trucks enter from India on a normal day, but this has dwindled to a sporadic passage of 5–10 fuel trucks daily since the start of the crisis, though shipments of perishables like fruits and vegetables have generally been allowed to pass. Moreover, India had also been stopping some Nepalese trucks at the Kolkata harbour. The blockade choked imports of not only petroleum, but also medicines and earthquake relief material.
Due to 2015 Madhesis Strike. Prime Minister K P Oli had signed the Transit and Transportation Agreement with China in March 2016, following months-long Indian blockade at the southern border.
PROBLEM IN CHINA'S AGREEMENT
Problem is all China's Port are very far - The Nearest one from Nepal is 3000 KM in China. Whereas it's 950 KM only nearest one in India.
So, Traders will think before doing the Trade as economically for Nepal it's not viable if they use China's port.
WHY NEPAL DID THIS AGREEMENT ?
If there is any blockade in India, Then Their(Nepal) Trade not stop, atleast they have some option (though for Nepal it's very costlier) and Trade not stop. So we can say Nepal can use China's port in case of any Emergency/Blockage.
IN AGREEMENT
China agreed to allow Nepal to use four of its seaports and three land ports (or dry ports ) (where cargo's store) for third country trade reducing the landlocked country's dependency on India to conduct international commerce.
Nepal will be able to access :
- Shenzen
- Lianyungang
- Zhanjiang
- Tianjin
This is not a big surprise that Nepal did the Transit Transport agreement with China. Because Landlocked country generally sign this kind of agreement. In Asia, There are 12 Landlocked countries and all have Transit Transport Agreement with different countries.
As India- Bhutan transit transport agreement exists, which recently renewed in 2017
CONCLUSION
Relation between Both India & Nepal are still strong. Due to Distance issue - Nepal will still use India's Port.
For more information, you can access below links:
https://timesofindia.indiatimes.com/world/south-asia/nepal-gets-access-to-4-china-ports-ending-indian-monopoly-on-transit/articleshow/65726862.cms
https://www.indiatoday.in/world/story/nepal-china-transit-agreement-ends-sole-dependence-on-india-1335863-2018-09-09
Above Information is as per data available in news till the date when I am posting this.
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