Kathmandu, Nov 08: India and Nepal have signed an agreement to set up the first ever rail link between the two countries. A railway agreement for the operation of the multi-million dollar Inland Container Depot (ICD) in Birgunj, bordering India, was signed here yesterday. The agreement, inked by the Indian ambassador to Nepal Shyam Sharan and the Nepalese Commerce Secretary Dinesh Chandra Pyakurel, clears the plying of cargo trains between the two countries, to and from Birgunj, according to sources in the Commerce Ministry here. India has constructed a 5.4 km long railway line from Raxaul to Birgunj at a cost of Rs 170 million, according to Indian Embassy sources here. The World Bank has provided a soft loan of USD 13 million for the construction of the ICD, Pyakurel said. it is estimated that Nepal will save 16 million dollars in transport cost annually as a result of the ICD.

"Nepal's international trade as well as bilateral trade with India is expected to increase manifold after the ICD comes into operation.


This will reduce the transport cost of raw materials imported by Nepal from a third country by 30-40 per cent, which will ultimately help increase Nepal's export trade," Pyakurel told a news agency.


Bureau Report