More reports on: Trade

China wants to extend its Nepal rail link to India: media

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24 May 2016

China, which has expanded its rail-and-road link to Nepal, now wants to extend a proposed rail link further into India, as it expands trade. China is now looking to rail-link Bihar to improve connectivity with India and South Asia, state-run Chinese media reports.

China and Nepal have already planned a cross-border railroad link to the Rasuwagadhi area in Nepal and the new China railroad link is expected to reach Nepal border by 2020, an article in the state-run Global Times said.

This rail line can connect China and India with a line connecting Rasuwagadhi to Birgunj, which borders Bihar, says the article. This will facilitate India's trade with China through the rail link.

This will also be an easier route than through Kolkata, saving time, cost and distance, the report said.

"The railroad connection to China not only is important for Nepal and Nepalese people's future development, but also has the capacity to build connectivity with the whole of South Asia. The government of Nepal has the chance to make history," the article says. It also criticises attempts to block major projects in Nepal.

"Challenge is both internal and external stakeholders' sensitivity about mega infrastructure projects. Unfortunately due to oversensitivity, some major projects were aborted before even a brick was laid. So the Nepali government must play a key role in bringing all the stakeholders into a sufficient consensus," it said.

The road and rail link, however, will serve China more than India or Nepal while at the same time blunting India's influence in the country.

India currently has a bilateral trade deficit of $48 billion in its $70 billion trade with China. The land route for trade could easily double this figure.

China already operates a combined road and rail service to Kathmandu through the rugged mountain ranges in Tibet to step up transportation links with land-locked Nepal.

A freight train from Lanzhou, the capital city of northwestern China's Gansu province now carries cargo to Xigaze, the nearest Tibetan town close to Nepal, from where the goods are transported to Nepal by road.

The whole journey, which includes 2,431 km of rail transport and 564 km of road transport to Geelong Port in Nepal, takes 10 days. It takes another 160 km of road transport to reach Nepal's capital Kathmandu. The combined transport takes 35 days fewer than traditional ocean transport, the report said.

Nepalese officials say the new routes with China will cut down dependence on India, which till now is the sole supplier of goods.

Prime Minister Oli's government in Nepal was keen on opening up new routes with China, including access to its port Guangzhou to reduce dependence on India in the aftermath of the blockade along the Indian border imposed by Madhesis in Nepal to express their resentment against the new constitution.





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