December 5: Competition among private companies of India has increased after the amendment to the Nepal-India Railway Service Agreement opened the way for private railway companies to trnasport containers to and from Nepal.
In the last three months, the number of such companies providing transportation services to Nepal from Indian ports has reached three.
Earlier, the Container Corporation of India (CONCAR) enjoyed a monopoly but now three companies are providing transportation services to Birgunj Dry Port. Pristine Logistics InfraProjects, the main partner of the company in charge of dry port operations, has also started shipping from Kolkata and Visakhapatnam in India.
According to trade and market manager of Pristine Mohammad Nabil Akhtar, their train arrived at the Birgunj dry port on Saturday carrying containers from Visakhapatnam port.
The company has also started their service from Kolkata port in India to Birgunj. Akhtar informed that a few days ago, 90 containers of industrial raw materials, plastics, electronic goods, readymade garments and other goods were sent to Birgunj from Kolkata port. The Hind Terminal, which started operating two months ago, has so far brought eight racks to the dry port. JM Baxi Group, which is active in port and railway services in India, has also started preparations for the transporting containers to Nepal.
The railway agreement between Nepal and India in 2004 gave CONCAR a monopoly on rail transport. Following an amendment to the agreement, private companies of Nepal and India are allowed to provide the service at competitive rates.
Nepal Railway Company, however, has not started its work yet.
CONCAR has slashed its freight rates after its rival companies began shipping overseas cargo to Nepal. The company had informed that they had reduced the fare on the same day Hind Terminal transported racks to Birgunj.
After CONCAR reduced fares by 30 to 35 percent, other companies also reduced their fares. However, the Nepali importers and exporters have not been able to reap the benefit of reduced fares till now.
Ashok Kumar Temani, coordinator of the Road Transport and Transit Committee of FNCCI Province 2 says that Nepal's foreign trade has not been able to reap the benefits even though other companies have offered services in a competitive rate.
Entrepreneurs complained that they have not been able to take advantage of the competition in shipping as the shipping company transports containers to Birgunj port itself and also conducts train fare transactions with CONCAR.
According to the traders, the shipping companies are the ones that are taking advantage of the reduction in fares by CONCAR. Former president of the Birgunj Chamber of Commerce and Industry Pradip Kedia said that there was no reduction in transportation cost even after the monopoly of CONCAR came to an end.