The April 25 earthquake has badly damaged two important trade routes to China, with several landslides along the routes. Houses and office blocks in Liping, Tatopani and Kodari that handle the Tatopani customs points have turned into rubble and the Rasuwagadhi trade route has not been spared either, bringng the country’s import and export with China to a grinding halt for over one and a half months now.
The pospects of reopening the export and import routes to and from China any time soon are bleak, and the monsoon, which is only days away, will induce landslides on the trade routes, which pass through steep hills. Furthermore, customs personnel at Tatopani cannot yet return to work, according to Nepali officials.
With the uncertainty over traffic through the usual routes, traders have started planning to import Chinese goods via Kolkata, India, with the next festival season in mind. They have started placing orders for Chinese goods via the alternative route, which will be more costly and time-consuming.
General Secretary of Nepal Trans-Himalaya Border Commerce Association, Arjun Gautam, said that traders have placed fresh orders for Chinese goods, targeting the festival season, but they are routing them through Kolkotta port. The goods will reach Kolkata by sea and then arrive in Kathmandu by land route.
Bhimlal Paudel, who imports raw materials such as soles and leather from China for his shoe factory in Kathmandu, said he will soon place his orders, but via Kolkotta port. One multi-storied warehouse containing imported raw materials for shoes collapsed during the earthquake.
Nepal imported goods worth Rs 78 billion from China in fiscal year 2013/14, and the exports stood at Rs 2.9 billion. Nepal’s trade with China by value is second only to India. The loss of revenue for lack trade with China hovers at around Rs 20 million per day.
“Investment in trading needs to be increased by at least threefold to attain the volumes that used to pass via the Tatopani and Rasuwagadhi routes”, said Gautam. Moreover, shipping time to Kathmandu via Kolkotta takes at least 45 days while transportation of the same goods takes only two weeks via Tatopani and Rasuwagadhi. Gautam said incidence of delay in shipping at Kolkotta is also high.
Customers will have to pay higher prices for Chinese goods imported via Kolkotta. Apparel, textiles, electronics, machinery and other equipment, leather products, fruits, nuts, chemicals, rubbers, plastics, metal products and motor parts are the major products imported from China.
Likewise, Nepal’s export to China is also affected. Nepal exports products such as textiles, mineral products, vegetable oils and fats and cereal crops, but no high value-added products.
Government officials say they have already started a dialogue with their Chinese counterparts to resume services at the customs of both countries. China’s customs officials at Tatopani had also been evacuated.
Commerce and Supply Secretary Ngaindra Prasad Upadhyaya visited Tatopani recently to assess for himself the state of the trade route. “We can open the route partially in the morning hours to bring in the 300 containers stuck at Khasa as rock fall begins only in the afternoon when the winds pick up,” he added.
Revenue Secretary at the Ministry of Finance Nawaraj Bhandari has been coordinating with the Department of Roads, the Ministry of Home Affairs and the Nepal Army to reopen the Rasuwagadhi route.
Bhandari said they are trying to reopen Tatopani only for bringing in the containers that are stuck there but the route is almost clear except a few landslides at some places. The customs office at Kerung on the Tibet side is intact enough for resuming business.
A massive landslide at Jure in Sindhulchowk last August had washed away about two kilometers of the road. It also became submerged by a lake that formed in the Sunkoshi River and the trade route was obstructed for over a month.