India eyes potential of turning Nepal into air transit hub

Nepal is being considered as a transit point between India and the rest of the world, according to the Indian Ambassador to Nepal Shiv Shankar Mukherjee.

Given Nepal's location between the world's two fastest growing economies; India and China, Mr. Mukherjee said Nepal has an opportunity to serve as a transit point for air cargo, a move that would bring considerable benefits to the country, reports Kathmandu's Himalayan Times.

"We are prepared to examine necessary bilateral arrangements that would make it possible for Nepal to exploit such opportunity, especially after forthcoming revision of air services agreement between the two countries," he said at the 13th annual Cargo Day organized by Nepal Freight Forwarders' Association (NEFFA).

India, he hinted, would be prepared to substantially liberalize the air services arrangements with Nepal to add international airports to the designated routes for bilateral trade.

Mr. Mukherjee added that expansion of the transport network and elimination of non-tariff barriers as well as development of infrastructure would be required to boost trade. At present about two-thirds of Nepal's foreign trade is with India and over 90 per cent of Nepal's third country trade transits through India.

On the other hand, Purushottam Ojha, the Acting Secretary at the Ministry of Industry, Commerce and Supplies, said the Inland Container Depot (ICD) at Sirsiya, Birgunj has failed to contribute to Nepal's external trade as expected. He also said that the government is planning to re-negotiate with Himalayan Terminal, the operator of the ICD.