Regional Trade and Connectivity in South Asia Gets More Than US$1 Billion Boost from World Bank

  4 min 5 sec to read
Regional Trade and Connectivity in South Asia Gets More Than US$1 Billion Boost from World Bank

June 30: The World Bank has approved US$1.03 billion of financing to help improve regional trade in Bangladesh and Nepal by reducing trade and transport costs and transit time along the regional corridors.

According to the World Bank,  the first phase of the Accelerating Transport and Trade Connectivity in Eastern South Asia (ACCESS) Programme will help the respective governments address the key barriers to regional trade ─ manual and paper-based trade processes, inadequate transport and trade infrastructure, and restrictive trade and transport regulations and processes.

Issuing a statement on Tuesday, the World Bank said that the Phase 1 programme will help replace lengthy manual and paper-based trade processes with digitized automated solutions in Bangladesh and Nepal. The automation will enable faster border crossing times and install electronic tracking of truck entry and exit, electronic queuing, and smart parking. The programme will also help improve selected road corridors and upgrade key land ports and customs infrastructure, while ensuring green and climate-resilient construction, the statement added. This will help the integration of landlocked Bhutan and Nepal with the gateway countries of Bangladesh and India, it further stated.

“Regional trade offers enormous untapped potential for the countries of South Asia. Today, regional trade accounts for only 5 percent of South Asia’s total trade, while in East Asia it accounts for 50 percent,” the statement quoted Hartwig Schafer, World Bank’s vice president for South Asia, as saying. “South Asia can boost economic growth significantly and create opportunities for millions of people by increasing regional trade and connectivity.”

The US$275 million ACCESS Project in Nepal will upgrade 69 km two-lane Butwal—Gorusinghe—Chanauta road along the East-West Highway to a climate-resilient four-lane highway. This is expected to reduce travel time by 30 percent, thus providing better access to India’s western seaports.

According to the World Bank, the project will construct market areas along the highway with dedicated spaces for women entrepreneurs and traders to ensure that women can benefit from the enhanced economic opportunities. It will also support capacity building and digital system to enhance trade and customs processes at Birgunj and Bhairahawa border points in particular. The programme will also help advance Nepal’s preparedness and subsequent implementation of the Motor Vehicle Agreement (MVA).

“Nepal has large untapped potential for regional trade and exports. Low regional trade is often a result of the high cost of connectivity,” said Faris Hadad-Zervos, World Bank’s country director for the Maldives, Nepal, and Sri Lanka. “The project will help unlock Nepal’s economic potential through better connectivity and trade, both between the provinces as well as regionally among Nepal and other countries to support a green, resilient, and inclusive development.”

“It is highly critical to ensure trade growth, long-term sustainability and resilience of investments, while minimizing actual degradations on ecosystems along the Nepal’s road network, which carries 90 percent of passengers and goods movement,” said Oceane Keou, World Bank’s task team leader of the Nepal Project and co-task team leader of the programme. “The project will implement an innovative green and resilient highway corridor concept in Nepal, based on a landscape-level development approach.”

In the second phase, the program will include Bhutan.

“A key focus of the ACCESS program is to support solutions that can most effectively reduce dwell times at trade gateways, which is vital to lowering trade costs. This entails greater border cooperation and coordination within and between countries, cutting down the physical inspection of goods, and simplifying regulations and processes,” said Erik Nora, World Bank’s task team leader of the program. “


No comments yet. Be the first one to comment.