Strengthening rail connectivity infrastructure in Bangladesh, Bhutan, India and Nepal will boost subregional trade
Posted Date – 12:45 AM, Sun – 4/16/23
Anita Barrick
Intraregional trade between South Asian countries has been less than 5% of total South Asian trade, while intraregional trade accounts for 60% in Europe, 35% in East Asia, and 25% in Southeast Asia. This makes South Asia one of the least integrated regions in the world. Inefficient connectivity and transit are the main factors contributing to low trade in the region, along with various other factors such as tariffs on imported goods and restrictive non-tariff barriers. For better economic integration, high-quality infrastructure and efficient cross-border transport systems need to be established to strengthen trade links.
In this direction, the Bangladesh, Bhutan, India and Nepal (BBIN) sub-regional initiative is conceived to create seamless connectivity among these four countries to enhance sub-regional trade and movement of people and achieve sustainable development.
the background
To promote the integration of transport networks, the SAARC (South Asian Association for Regional Cooperation) Regional Multimodal Transport Study (SRMTS) conducted in 2005 recommended improving transport infrastructure and connectivity in SAARC countries. However, in November 2014, the SAARC Summit held in Kathmandu failed to reach a consensus on the signing of the SAARC Railway and Road Interconnection Agreement. The summit declaration emphasized the need to link South Asia with adjacent regions, including Central Asia, and beyond through various means of connectivity, and directed the relevant authorities to initiate national, regional and subregional measures and necessary arrangements to this end. Since then, the Bangladesh, Bhutan, India and Nepal (BBIN) and India, Myanmar and Thailand (IMT) blocs have started negotiations on sub-regional and bilateral connectivity agreements.
South Asia is one of the least integrated regions in the world, with intraregional trade between these countries accounting for less than 5% of total South Asian trade
Bangladesh, Bhutan, India and Nepal together form the sub-regional organization BBIN, with the support of two joint sub-regional working groups – Transport and Connectivity, and Water Resources Management and Electricity/Hydropower.
In a major development, on June 15, 2015, the United States signed the United States Motor Vehicle Agreement (MVA). Since then, the focus of BI has been on the implementation of the BI Motor Vehicle Agreement. Overland freight transport between US countries currently has to face delays and congestion due to infrastructure and procedural bottlenecks at land borders.
Currently, cargo trucks or passenger vehicles from India and Bangladesh cannot enter each other’s territory. Bangladeshi cargo trucks or passenger vehicles cannot enter Nepal or Bhutan. They must utilize the services of Indian, Nepalese or Bhutanese transporters. However, between India, Nepal and Bhutan there are some liberal arrangements for border crossings.
After the India-Pakistan War in 1965, the India-Pakistan railway traffic was interrupted. Between India and Nepal, rail services have continued.Bhutan has no railway infrastructure so far
BBIN MVA operates to facilitate the cross-border movement of vehicles, thereby facilitating the seamless cross-border movement of people and goods. In addition to improving connectivity, the MVA seeks to save the business community significant transaction costs and time, and contribute to the economic development and integration of the region.
Esplanade Rail Link
Until 1947, South Asia had a complete railway system. Even after the partition of India, rail transport and communications continued. After the India-Pakistan War in 1965, the India-Pakistan railway traffic was interrupted. Between India and Nepal, apart from interruptions due to infrastructure upgrades, rail services continue. To date, Bhutan has no railway infrastructure.
A rail agreement is proposed in the Bangladesh, Bhutan, India and Nepal (BBIN) sub-region to develop rail links and enhance connectivity between northeastern India and its BBIN neighbours. Although there hasn’t been much progress on the BIN railway agreement, rail transport between India, Bangladesh and Nepal has recently expanded.
There is great potential for the integration of rail links in the U.S. Rail transport has an unusual advantage in cross-border trade, because freight trains do not need to be transshipped at the border and can enter terminals in other countries, while goods transported by trucks must be transshipped to other trucks at the border.
India Bangladesh Railway
of seven Operational railway connections between India and East Pakistan (today’s territory of Bangladesh) By 1965, five railway connections between India and Bangladesh had been restored and were in operation. These railway lines are Petrapole (India)-Benapole (Bangladesh), Gede (India)-Darshana (Bangladesh), Singhabad (India)-Rohanpur (Bangladesh), Radhikapur (India)-Birol (Bangladesh) and Haldibari ( India) – Chilahati (Bangladesh).
The non-operating rail connections are:
Karimganj/Mahisasan (India)-Shahbazpur (Bangladesh): The rehabilitation of the railway track from Shabazpur to Kulaura has been included in the line of credit extended by the Government of India to Bangladesh. Work on this line is in progress.
Chengrabandha (India) – Burimari (Bangladesh): The line between New Mal Junction and Changrabandha on the Indian side has now been converted to broad gauge. The Bangladesh side of the Burimari-Lalmonirhat line is currently on meter gauge. Reinstatement of this link could be considered in the future once the Bangladesh side is converted to wide gauge.
new railway line
In addition to reviving the old line, a new railway line between Akhaula (Bangladesh) and Agartala (India) is also under construction. The Akhaura-Agartala New Rail Link is a cross-border rail link project to connect the existing Agartala station to the Gangasagar (Bangladesh) station on the Dhaka-Chittagong rail line of the Bangladesh Railways.
India-Nepal Railway Line
The railway between Nepal and India has been operating since the early 20th century when the British established a railway system in South Asia. There are 3 cross-border railways in operation between India and Nepal, namely Chogbani (India) – Biratnagar (Nepal), Jainagar (India) – Kurta (Nepal) and Laxall Birgunj.
To conduct cross-border freight business by rail, the Railway Service Agreement (RSA) was signed on 21 May 2004 by the Ministry of Railways, the Government of India and the Ministry of Industry, Commerce and Supply (now the Ministry of Commerce) and the Government of Nepal. Before this agreement, there was no rail freight between the two countries. Therefore, a framework agreement is needed to guide and regulate the operational and commercial aspects and to establish customs clearance procedures for rail cargo.
In addition to the RSA, in July 2021, India and Nepal also signed a Letter of Exchange (LoE) making certain amendments to the relevant provisions of the RSA. The LoE requires and permits all authorized freight train operators, including public and private container train operators, motor freight train operators, special freight train operators or any other operator authorized by Indian Railways, to utilize the network of the country to carry Nepalese Containers and other shipments – Bilateral shipments between India and Nepal or third country shipments from Indian ports to Nepal. The liberalization of rail operations is aimed specifically at reducing the cost of transporting cars and certain other products that are transported using specialized wagons.
Currently, cargo trucks or passenger vehicles from India and Bangladesh cannot enter each other’s territory.Bangladeshi cargo trucks or passenger vehicles cannot enter Nepal or Bhutan
Freight trains owned by Nepal Railways are also allowed to carry Nepal direction cargo through the Indian Railways network (in and out on the Kolkata/Haldia to Biratnagar/Birganj route) as per the standards and procedures of the Indian Railways. With the entry into force of the LoE, India’s efforts to enhance regional connectivity under the “neighborhood first” policy have intensified.
Bangladesh-India-Nepal Network
Bangladesh and Nepal signed an agreement in 1976 under which goods exported from Bangladesh to Nepal and goods imported into Nepal from other countries are transported through Indian territory as “transit traffic”. India has been providing access to its rail network for the transit of Bangladeshi exports and overland trade between Bangladesh and Nepal.
By rail, transit traffic from Bangladesh to Nepal’s Birganj and Biratnagar railway hubs, mainly via Rohanpur (Bangladesh)-Sinhabad (India) and Birol (Bangladesh)-Radi The junction of two India-Bangladesh railways in Kapur (India). Every year a large amount of export goods is transported from Bangladesh to Nepal by rail. However, there is a need to strengthen these trade links to facilitate integration in the region.
efficient connection
The two largest trading partners of the BIN region are India and Bangladesh. In recent years, trade between India and Bangladesh via rail transport has increased significantly. To support trade transport linkages, various infrastructure works are underway which will transform the transport network in the subregion and contribute to greater economic growth. Although these projects are considered to be of national importance and primarily aimed at domestic use, they have a potential multiplier effect that can support economic integration in the subregion.
Some of these key infrastructure projects include Dedicated Freight Corridor (DFC) in India, Khulna-Mongla Railway Line Project (Bangladesh), Padma Railway Line (Bangladesh), Second Jamuna Railway Dedicated Bridge (Bangladesh), Jayanagar-Bardibas Railway line (Nepal), Raxaul-Kathmandu railway line (Nepal), Sivok-Rangpo railway line (India) have potential to connect India and Bhutan.
Rail transport has an unusual advantage for cross-border trade because, unlike goods transported by trucks, freight trains do not need to be transshipped across borders
The growth in international trade, the continued surge in cross-border trade via rail, and the acceptance of rail as an alternative mode of cross-border trade all indicate that countries seek efficient connectivity to facilitate regional integration. Upgrading existing infrastructure, building new infrastructure and creating reliable international rail corridors will bring new opportunities to the region. It also involves a higher level of cooperation between countries to find synergies between national projects and international corridors.
(The author is the Deputy Chief Security Officer of Indian Railways, and also served as a railway adviser to the Indian High Commission in Dhaka, Bangladesh)
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