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Expansion of connectivity with Nepal and Bhutan to boost trade: Part-II

07:45 AM Dec 10, 2023 IST | Dr Rupak Bhattacharjee
UpdateAt: 11:27 PM Dec 09, 2023 IST
expansion of connectivity with nepal and bhutan to boost trade  part ii
Bhutan King Jigme Khesar Namgyal Wangchuk arrived in Guwahati on Friday on a three-day visit to Assam.

Bhutanese King Jigme Khesar Namgyal Wangchuk’s two day (November 3-4) visit to Assam assumes significance in the light of the announcement of some major infrastructure development projects involving the state that shares 265.8 km-long border with the Himalayan nation. The king met Assam Chief Minister Himanta Biswa Sarma on November 4 and discussed issues of mutual interests including his dream project of constructing a mega/smart city in Gelepu which is just across the state’s border in Chirang district. In his bids to attract investment for the mega city project, the king visited India’s business capital Mumbai and met top industry leaders.

The proposed smart city project will be part of the Sarpang district special economic zone (SEZ) project. The king’s smart city and SEZ plans were also part of discussions with the Indian premier on November 6. These ambitious projects are expected to attract lots of tourists boosting Bhutan’s economy. The Kokrajhar-Gelepu rail route is also an integral part of the king’s mega city and SEZ plans, and the cross-border rail project figured in king’s discussion with the Assam chief minister on November 4 at Guwahati.

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 The king started his eight day-long visit to India from Assam to further boost the unique ties between the border state and Bhutan. After the operationalisation of Kokrajhar-Gelepu rail connectivity, the people of Northeast especially Assam will be benefitted as the Bhutan government has also planned to build an airport at Gelepu as part of the larger Sarpang district SEZ initiative. During the bilateral talks, the two sides agreed to convert the existing LCS at Dadgiri in Assam to a modernised ICP along with development of facilities on the Bhutanese side at Gelepu, indicating India’s support to the king’s SEZ project.

Among all the North Eastern states, only Assam has an industrial base and robust market. It is the largest economy contributing about 60% of NER’s GDP. Tea and petroleum are the major contributors to the state economy. In its attempts to develop industrial infrastructure in the state, the Assam government is currently supporting 800 industrial units including an export processing industrial park at Amingaon in Kamrup district, three industrial growth centres, 11 industrial infrastructure development centres, a food park at Chaygaon and a North East Mega Food Park in Nalbari district, along with 21 industrial estates, 17 industrial areas, and 18 growth centres.

An India Exim Bank study has estimated that Assam has the potential to generate merchandise exports worth $710.3 million by 2024-25 if it focuses on certain sectors including tea and agro-based products. A March 2021 Asian Development Bank (ADB) study titled “Assam As India’s Gateway to ASEAN” has noted that despite the state government’s efforts to promote export-oriented industries, Assam’s share in regional trade has been limited and 95% of India’s exports to its eastern neighbours Bangladesh, Bhutan and  Myanmar come from states outside North East. The study has added that given Assam’s geostrategic location, it is well-suited to meet the import demand of neighbouring countries if it develops appropriate manufacturing capabilities, human resources, and infrastructure including logistics.

 Assam had a vibrant economy during the colonial period due to its abundant resources like oil, coal and tea. But the partition of the sub-continent made Assam geographically and economically isolated. The state’s flourishing trade of oil, coal and tea with foreign countries suffered huge setbacks as all cross-border road, railway and waterway links through East Pakistan (now Bangladesh) were closed after 1947. The closure of trade routes and access to sea had a debilitating impact on Assam’s economy in the post-independence era. Hence the development of multimodal connectivity and transport linkages with neighbouring countries is important for seamless movement of goods.

The experts have called for early implementation of the Bangladesh, Bhutan, India and Nepal (BBIN) Motor Vehicle Agreement (MVA) and the eventual adoption of a multimodal connectivity protocol through roadways, inland waterways, railways and coastal shipping transport system for cost-effective, efficient and seamless movement of goods and people in the sub-region. But the BBIN MVA initiative, which was signed on June 15, 2015, has slowed down following Bhutan’s withdrawal from it. In 2017, the Parliament of Bhutan decided to hold off on endorsing the initiative but gave consent for entry into force of the agreement among Bangladesh, Nepal and India.

On March 7-8, 2022, the government officials of Bangladesh, India and Nepal met in New Delhi to discuss the Passenger, Personal and Cargo Vehicular Traffic. Reports say the meeting finalised the enabling MoU for implementation of the BBIN MVA by three countries. This will be signed by the three countries after ratification of the MVA by Bhutan. The meeting also agreed to operate the transport routes of Kakarbhitta (Nepal)-Kolkata (India)-Dhaka (Bangladesh) or Biratnagar (Nepal)-Kolkata, or both. A study of the ADB, which is providing technical support, proposed 10 regional road networks as South Asian Corridors. Seven of them have been identified in the BBIN sub-region.

Under the “Neighbhouhood First” policy, India has attached priority to expand rail and road connectivity and development of border infrastructure with Nepal which is benefitting the border states of Bihar and Uttar Pradesh. The major border infrastructure developments on the India-Nepal front have been setting up of ICP at Birganj-Raxaul (2018), Biratnagar-Jogbani (2020) and Nepalganj-Rupaidiha (2023). Besides, construction work is beginning on the Bhairahawa-Sunawali ICP and an agreement signed for further expansion of trade and tourism between India and Nepal.

The rail connectivity between the two countries has also gathered pace in recent years. In April 2022, Prime Minister Modi and his Nepalese counterpart Sher Bahadur Deuba inaugurated the 35 km Jaynagar-Kurtha section of the ongoing 68.70 km-long Jaynagar-Bijalpura-Barbidas rail route. The Kurtha-Bijalpura segment has recently been operationalised and the Bijalpura-Barbidas section is being surveyed. Reports say the work is also progressing well for other cross-border rail links between India and Nepal.

The Jogbani-Biratnagar cross-border rail link has been opened for cargo traffic in 2023. Moreover, the final location survey is completed for the Raxaul-Kathmandu broad-gauge line.  The EAM has claimed that the development of border infrastructure and transport connectivity has bolstered India’s national security and created new economic opportunities, while also improving the living standards of the people in border areas.

Several new road projects have also been undertaken by the Union Ministry of Road Transport and Highways (MoRTH) along with up gradation of old National Highways (NHs) in the NER including Assam. The MoRTH has also planned to build an Economic Corridor (EC) under the Bharatmala Scheme (BS) to improve connectivity in border and remote areas to facilitate faster movement of cargo and increase of export. The Assam government has been pitching for the improvement of the state’s road networks with other Northeastern states to connect with Bangladesh, Bhutan and Myanmar.