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Vizag port offers low cost, link to China

Vizag port offers low cost, link to China

WASHINGTON: Officials at the Visakhapatnam Port have urged Nepali traders to make more use of the seaport in the Indian state of Andhra Pradesh citing cost of ferrying goods from the port is lower. The port saw departure of first cargo train to Nepal on June 6. Another train carrying third-country goods is likely to leave for Nepal in the end of July, while the third will most likely depart the port by the end of August, according to Kalyana Chakravarthy, senior station manager at Visakhapatnam Port Trust, said. The frequency at which cargo trains are leaving the port for Nepal indicates underutilisation of the port. Nepal currently heavily relies on Haldia Port near Kolkata to export and import goods to and from third countries. One of the attractions of this port is the distance. It is located at a distance of around 704 km from Nepal. Visakhapatnam Port, on the other hand, is located at a distance of around 1,436 km from Nepal.

Yet the drawback of Haldia Port is that it cannot handle larger cargo vessels because of its shallow water. So, cargoes have to be transferred to smaller vessels in Singapore or Colombo, Sri Lanka, before they are shipped to Kolkata. This increases the cost of trading. Although the Visakhapatnam Port is located quite far away from Nepal, it offers lower sea freight costs, and freight forwarders do not have to pay various charges such as detention cost, demurrage cost and many other formal and informal charges, port officials said. Another advantage, according to officials, is low sea freight cost for movement of goods to and from ports in China. “The low sea freight cost due to direct link with Chinese ports, and low port charges will work as compensation for Nepali traders worried about higher cost emanating from longer distance,” said Ashok Kumar Temani, chairman of Road Transport and Transit Committee at the Federation of Nepalese Chambers of Commerce and Industry. He, however, said more and more shipping companies have started providing services using the port. “Considering all the costs, it is beneficial for us to use this port,” he said.

The Visakhapatnam Port also completes all documentation processes within 24 hours, whereas the same work takes 7-10 days in Kolkata. Indian officials say Nepali traders should not use the port just to import goods but to export as well. For instance, Nepal can export pashmina, handicraft items, fruit juice and other food products to southern part of India using this port, according to Sushil Mulchandani, chief operating officer at Visakhapatnam Port. Until now, Nepali exports to India are largely confined to northern parts of the country. “There is high demand for Himalayan mineral water in south India,” said Mulchandani. Indian officials have said they would make all the arrangements to import goods from south India through this port. Yet one of the hurdles in increasing trade via this port is language. “Nepali businessmen will have to learn the local language. Distance is obviously another problem. Kolkata is more familiar and it is near from Nepal border,” said BC Upreti, a member of Nepal-India Eminent Persons’ Group, adding, “There is a need to disseminate information on advantages of using this port.