(Image: DhruvStar Industry Insights | Original Artwork)
India and Nepal have amended the Treaty of Transit to enable the movement of rail-based freight between Jogbani in India and Biratnagar in Nepal, including bulk cargo.
A bilateral meeting between the two sides formalised the Letter of Exchange (LoE) that updated the Protocol to the Treaty of Transit between India and Nepal.
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India-Nepal Trade: Overview
(Data Source: Ministry of Commerce & Industry)
- India remains Nepal’s largest trade and investment partner, accounting for a significant share of Nepal’s overall external trade.
- India’s exports to Nepal: petroleum products, iron and steel, cereals, vehicles and parts, and machinery components
- India’s imports from Nepal: edible oils, coffee, tea, and jute
- Approximately 150 Indian companies are operating in Nepal across various sectors, including manufacturing, banking, insurance, logistics, education, telecommunications, power, and tourism.
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Expanded Rail Connectivity: Jogbani-Biratnagar Link
The Letter of Exchange enables direct rail connectivity on the Jogbani-Biratnagar rail link for containerised and bulk cargo.
It will enable the seamless movement of goods from the ports of Kolkata and Visakhapatnam to the Nepal Customs Yard in Morang District, near Biratnagar.
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Strengthening Multimodal Trade Corridors
The liberalised protocol extends to key transit corridors:
- Kolkata-Jogbani
- Kolkata-Nautanwa (Sunauli)
- Visakhapatnam-Nautanwa (Sunauli)
These measures strengthen multimodal trade connectivity between the two countries and expand Nepal’s access to third-country trade routes, supporting smoother and more reliable transit movements.
Ongoing Cross-Border Infrastructure Collaboration
The meeting also took stock of ongoing efforts to upgrade cross-border connectivity and enhance trade processes, including the expansion of Integrated Check Posts and other related infrastructure.
DhruvStar Industry Insights: What it Means for the Indian Industry
- Manufacturing Exporters Get a More Reliable Nepal Route: Indian exporters supplying FMCG, construction materials, food products, and industrial goods to Nepal can benefit from lower transit time and reduced handling costs. This is an opportunity to expand distribution networks deeper into Eastern Nepal.
- Rail-Linked Inland Hubs Can Develop New Nepal-Focused Services: Firms operating warehousing and consolidation facilities in Bihar, Uttar Pradesh, Jharkhand, and West Bengal can design Nepal-focused rail–road logistics offerings. This opens space for integrated cargo management, packaging, and customs support services.
- Transport, Cold-Chain, and Agri-Exporters Can Tap into Third-Country Trade Growth: Improved Transit Efficiency Strengthens Nepal’s Connectivity to Global Markets. Indian firms in agri-exports, pharmaceuticals, and processed food can position themselves as preferred suppliers for Nepal’s re-export and value-added channels.
Sources
[1] PIB
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