Development of ICPs, dry ports to reduce cost of trade

Kathmandu, July 17

In a few years from now, Nepal will have at least a dozen dry ports including Inland Clearance Depots (ICDs) and Integrated Check Posts (ICPs).

Currently, the country has two ICPs in operation at Nepal-India border in the south in Birgunj and Biratnagar and three ICDs in Birgunj, Bhairahawa, Kakarbhitta. Birgunj ICD is the railway-based such facility in the country. Plans are underway to develop railway facility at the Biratnagar ICP and proposed Chandani Dodhara ICP.

An ICD is in operation at Tatopani, a border pass between Nepal and China in Sindhupalchok district in the North.

Likewise, an ICP at Nepalgunj border is under-construction while two ICPs at Chandani and Dodhara on the western border with India and in Bhairahawa are proposed. Likewise, construction of the ICD in Chobhar of Kathmandu is completed and is ready for operation, ICD in Timure at the Rasuwagadhi border is under-construction, and an ICD at Korola border with China is proposed, said Ashish Gajurel, Executive Director of the Nepal Intermodal Transport Development Board (NITDB).

The NITBB is responsible for the regulation and management of the cross-border infrastructures like ICDs, dry ports, Container Freight Stations, ICPs, and collection and distribution centres.

An ICD/ICP has facilities like customs, ware-house, quarantine, workshop, parking, laboratory, bank, administration, canteen, security booth, dormitory, and cargo storage.

According to Gajurel, the Chobhar Dry Port will significantly facilitate in the trade and reduce the cost of trade as the traders can make customs clearance of the goods entered into Nepal and bound to the Kathmandu Valley at the port instead of at the border point.

NITDB is set to bring the facility into operation in three months.

 

Trade facilitation

Trade expert and former Commerce Secretary Purushottam Ojha said that dry ports play an important role in facilitating trade in a landlocked country like Nepal.

"They certainly make positive impact on trade facilitation but there should be suitable working modality and procedures," he said.

Ojha said that as per the initial estimates the Birgunj ICP was expected to reduce the cost of trade by 40 per cent, however there were not any recent studies to know the exact number.

President of Nepal Chamber of Commerce, Rajendra Malla, said that the dry ports and ICPs generally reduce about 15 per cent logistics cost.

"Dry ports provide yards to store containers, warehouse for goods and cold storage for perishable agricultural products. Trade facilitation has been certainly improved due to the dry ports," he said.

According to him, exports of Nepali goods will also be facilitated by the port infrastructure.

 

Pioneer Birgunj

Started in 2001, Birgunj ICD or Sirsiya Dry Port is the only railway-based trade facility so far. It is the largest trade point with 36.5 per cent share in exports and 33 per cent share in imports in the 11 months of the last Fiscal Year 2020/21, according to the statistics of the Department of Customs. Amount-wise the size of exports was Rs. 44.23 billion and imports Rs. 456.2 billion. The port is operated by Pristing Valley Dry Port Pvt. Ltd. since July 2020.

An ICP came into operation in Birgunj from April 2018. It is managed by the NITDB and handles 800 freight vehicles in a day on an average. Facilities like boom barrier, parking yard, new warehouse, additional inspection shed and others are proposed to be developed at the ICP.

Exports and imports from Birgunj border point in the previous FY 2019/20 were 33 per cent and 34.3 per cent respectively. Biratnagar, Tribhuvan International Airport and Bhairahawa are the other largest trade points in Nepal.

Likewise, Biratnagar ICP, inaugurated in January 2020 by then Prime Minister KP Sharma Oli and his Indian counterpart Narendra Modi, handles about 300-400 trucks a day.

The ICD in Bhairahawa came into operation in 1999 and has 250 truck parking facility. Additional parking yard is being developed at the port with financial support from the World Bank while the NITDB has proposed to acquire additional 50-100 bighas of land to expand the facility of the ICD.

Kakarbhitta ICD known as Mechi Nagar Dry Port was launched in 2010 and can handle 200 containers/trucks a day.

Dry Port in Larcha of Tatopani came into operation in May 2019.

 

Facilitating north-south trade

With the development of North-South Road Corridors along Koshi, Gandaki and Karnali rivers, trade between India and China can happen via Nepal and dry ports and ICDs will play a crucial role in facilitating the north-south trade.

Meanwhile, NITDB is installing modern technology such as gantry cranes and automated gates at the dry ports and facility for truck tracking. First of such facility will be installed at the ICD in Birgunj. A gantry crane is an overhead crane with girder set up that can move along a track or railway and can load and unload containers. They are used to pick up the containers from the train and load onto a truck.

An ICP in far-west

NITDB is set to develop ICT and ICP at Chandani Dodhara Municipality of Kanchanpur district in Sudurpaschim Province within next four fiscal years.

The Master Plan of the project is ready and the board is hiring consultant for the preparation of the Detailed Project Report and Environment Impact Assessment (EIA). The facility will spread in an area of 280 bighas in Gaurishankar and Mayapuri community forests.

The project will be developed in two phases where the first phase will cost about Rs. 6.98 billion and second phase Rs. 12.37 billion. Railway track and storage facility for dust cargo will be constructed in the second phase.

Similarly, ICP in Nepalgunj is being developed with Indian support and in Timure with Chinese assistance.

 

ICDs/ICPs in operation

Birgunj ICD (railway based)

ICP Birgunj

ICP Biratnagar

Bhairahawa ICD

Kakarbhitta ICD

Tatopani ICD

ICDs/ICPs under-construction/Proposed

Kathmandu Dry Port (Chobhar ICD)

Timure ICD (Rasuwa)

ICP Nepalgunj

ICP Bhairahawa (proposed)

ICD Korola (proposed)

ICP Chandani Dodhara (proposed)

Published in The Rising Nepal daily on 18 July 2021.