ECTS: Revolutionizing Nepal’s trade

Trade and transit have always gone hand in hand. As civilizations evolved and countries came into existence, the laws regarding transport of goods became more and more stringent to prevent malpractices like smuggling. The laws now need to be molded according to the new needs of the world to make trade easier, cheaper, and convenient.

Let us understand this concept with the help of an example. Take, for instance, import of goods from Singapore. We’re discussing this particular example as Nepal is a landlocked country, which means that it relies heavily on India to facilitate its imports through roads and railways via Kolkata Port and more recently Vizag Port.

Easy transit procedures is Nepal’s sovereign right. However, the Nepal-India treaty of transit complicated these procedures, making them time-consuming and expensive. There was continuous friction on the subject between the two countries. The Nepali side always complained that procedures are expensive, cumbersome, and lead to delays. It was alleged that Custom Transit Declaration (CTD) required some 21 procedures and 30 signatures before goods could be released. Nepal government has actively pursued changing the procedure to international transshipment for over a decade, starting in December 2011 with the inter-governmental meeting of the two Commerce Secretaries.

After due consideration and assistance of the Asian Development Bank, Nepal and India entered a Memorandum of Intent on 7 June 2017: it was bilaterally agreed to launch a pilot project to facilitate transit traffic by using Electronic Cargo Tracking System (ECTS). The project was slow to take off from Kolkata. But after Nepal pushed for its extension to Vizag, it became a great success.

The following benefits of ECTS have been revealed since its implementation:

  • Earlier, some six documents, 21 signatures, and 30 procedures had to be undertaken at Kolkata Port for clearance. Sensitive goods required an insurance policy and bank guarantee for clearance. Thanks to ECTS, all of these requirements have disappeared.
  • In view of the enhanced security provided by GPS tracked electronic seals, Indian Customs agreed to waive the need for an insurance policy for sensitive goods which benefited Nepali importers by bringing down the cost of transaction.
  • Before the implementation of ECTS, it took more than 45 days to deliver the goods, but now, the entire process is taking only 15 days. In some cases, the goods have been delivered in just seven days.
  • Since ECTS allows the concerned authorities to track the movement of goods at all times, the transporters’ laid-back attitude has been put in check, and any unnecessary detours/stoppages can now be immediately spotted.
  • The new system has brought Nepal and Indian customs on a single digital platform helping Nepal make a leap in World Bank’s ease of trading across borders index, from 76 in 2018 to 60 in 2020.
  • When the Covid-19 induced lockdowns were in place and most global supply lines were broken, this new automated procedure became a lifeline for maintaining Nepal’s global supply chain.

The Vizag miracle

The cargo movement from Vizag was most affected due to long distance from Nepali border (1,500 km) and because Nepal did not have a consulate general office in Vizag. So getting bank attested documents and letter of undertaking from CG Office to Vizag delayed customs clearance of cargo by weeks. At one point, thousands of containers were piled up at Vizag Port.

Meanwhile, Maersk Line had already started a new commercial service for Nepal where freight was prepaid up to Inland Clearance Depot Birgunj. So the eco-system was already in place for implementing ‘transshipment’ in place of ‘transit’. Nepal government’s push came at the right time.

India agreed to implement a transshipment procedure from Vizag, subject to affixing the electronic GPS lock system, freeing Nepal’s importers from the hassles of engaging a Customs House Agent for clearance and transporter for movement of goods.

From then on, it became the responsibility of the shipping lines to complete customs procedures and transport goods through Container Corporation of India, via rail, to ICD Birgunj. It led to a dramatic improvement in the ease of doing business for Nepali traders. Within a few weeks, the entire backlog of containers at Vizag was cleared.

All of these advantages and reforms that have been brought about since the implementation of ECTS make its benefits self-evident. As the system is relatively new, there is plenty of misinformation in the market, which the importers need to be wary of.

While the published ECTS rate is a mere Indian Rs 3,300 or about 2-3 percent of total freight charges, shipping lines are taking advantage of the new convenience and have increased their rates exorbitantly. Some are even charging as much as Rs 10,000 in the name of ECTS. Awareness of cost of service is a must to negotiate charges with the shipping lines; and where ever shipping lines overcharge in the name of ECTS, traders must bring it to the notice of the Department of Commerce.

The author is Managing Director, Safexpress, an Indian logistics company

Nepal's wasted talent

Nepal probably is the most fortunate nation today. Its population statistics would make any planner or policy maker gasp with excitement. Our average age is 24, which means we are one of the youngest countries in the world. Presently, with around 95 percent of our population in working age or yet to enter working age, we have a golden opportunity at hand.

But the sad destiny of our youth and our nation was summarized aptly by champion shooter Jitu Rai back in 2014. Asked by Setopati.com what he thought he would be doing if he hadn't joined the Indian Army, Rai had replied bluntly, "I would either be in the Gulf, or tilling my farm in Sankhuwasabha."

Born in Sankhuwasabha, Jitu Rai had joined the Indian Army in 2006. As a recruit, his instructors noticed his excellent pistol shooting skills and he was selected for the 'Young Blood Championship' of the National Rifles Association of India. Rai proved his merit and rose in the game to become a gold medalist in Asiad, Commonwealth Games and the World Cup. In 2014, he was world no 1 in 10-meter pistol shooting category. What Rai did and what he said suggest that given the opportunity Nepali youths can shine in any field. But the Wikipedia page on Jitu Rai proudly declares him as a naturalized citizen of India, which has also awarded him with a Padma Shree.

"Given an opportunity, a Nepali can do anything," is an oft-spoken phrase of our Prime Minister KP Sharma Oli. But our politicians, and government officials alike, have become champions in missing golden opportunities and covering it all up with such rhetoric. While addressing a group of sports persons and related stakeholders last month, the prime minister was, as always, in a preachy mood.

"Practice is a must to win. You all must practice and practice hard to win," were the overarching themes of the PM's address. But sports history proves that every achievement is hard-earned. And nothing can be a better proof of leadership, management, teamwork, dedication, hard work, as well as strategic clarity and effective utilization of resources in today's world than the medal tally in sports championships. Our sports achievements are a representation of how we have, as a nation, hopelessly mistreated our talents and wasted opportunities for many years. Examples like Jitu Rai are a living testament that the burden of this failure does not rest on individual players.

If we look deeper, we find stories of unparallel dedication among us. In the national women's under-19 football team that played in Dhaka last year, there were six players from a football club in a small town in Syangja district. Three of the girls were from the marginalized communities: two Dalit and one Muslim. Last 20 years of our country are marked with unprecedented political turmoil. As a result, this has also been an era of policy paralysis in different sectors. Despite that, dedicated sons of the soil like the coach of Waling Football club Dilip Thapa have worked tirelessly. He trained young boys and girls, mostly from marginalized communities and poor families, rigorously almost two times a day. Surprisingly, all of his dedication and service is voluntary. 

With such an apathy to developing an institutional support for its citizens' growth, no nation can do justice to its resources. This lack of an institutional result-oriented approach to performance is one big reason behind our collective failures in other fields too.

The prime minister, at the same event, announced that players would be supported according to government capacity—the underlying assumption being that sports aren't a priority, and hence resources will be used only after addressing other greater priority areas. But it is time we learn from success stories across the world.

At the 1996 Olympic games in Atlanta, Great Britain had ranked thirty-sixth in the medal tally, finishing below countries like Algeria, Belgium and Kazakhstan. The British press had named it a 'national scandal', the country's worst-ever result. But the government intervened swiftly. UK Sport, a dedicated agency, was set up and a vast amount of money was sourced from National Lottery revenues. The funds were utilized for a strict 'no comprise' system that invested in best chances of winning medals, and it set up the English Institute of Sports for providing sports scientists to all the national sports teams.

Four games later, in 2016, at the Rio Games, Great Britain stood second in the medal tally, proudly above China. As João Medeiros writes in a beautiful book, Game Changers, "behind every medal was a closely bound triumvirate: a talented athlete, an astute coach and a methodical sports scientist. And theirs was invariably a story of struggle, guesswork, dedication and conflict."

We as a nation have to do a lot to set up a culture of institutionalized support for dedicated champions in every field. The performance of the likes of Jitu Rai shows that if we build mechanisms to invest in young talents, our youth will do what it takes to win. But time is running out, and we are indifferent as a great window of opportunity is speeding toward a permanent closure.

 

Rihanna, Modi's India, Oli’s Nepal

“What is India's No. 2 foreign policy challenge?” asked Happymon Jacob of Jawaharlal Nehru University in his Feb 3 tweet. “No. 1 is Rihanna.” He was ridiculing the panicky response of the Indian government to the Barbadian singer’s retweet of a CNN story. “Why aren’t we talking about this?! #FarmersProtest” was all that she had written in reaction to the ongoing farmer protests in India. Later, Swedish climate activist Greta Thunberg tweeted her support for Indian farmers. The Indian government reacted as if it was under attack from a malicious foreign force. Its External Affairs Ministry said it was “unfortunate to see vested interest groups trying to enforce their agenda on these protests, and derail them.”

The Indian government didn’t stop there. It urged Bollywood superstars and famous cricketers to publicly denounce all such efforts to “divide India”. You could see this as exemplifying the Indian establishment’s lack of confidence. But that perhaps is not the whole story. Narendra Modi and the BJP came to power on the back of a polarizing religious agenda. Faced with a tanking economy and widespread protests, there was no easy way for Modi to wiggle out except, and once again, by inventing external enemies.

The message: Look, we are under the assault of foreign enemies and if we don’t unite behind our government, at stake will be no less than our sovereignty and national unity. If someone can pull up a conspiracy theory behind how Thunberg and other members of an international left cabal want to destabilize India, it’s a Bharat Ratna-worthy achievement in Modi’s India. Sadly, this whipping up of nationalism against external enemies, largely imagined, works everywhere, from the US, India to Nepal. 

In Nepal, bereft of any other agenda, and feeling marginalized by the intelligentsia and other political actors, KP Oli has now cottoned to Hinduism to resurrect his political career. His repeated attempts to get into India’s good books rebuffed, he is now busy needling the Ayodhya-addicted BJP establishment by claiming his country’s ownership of Lord Ram. New Delhi either supports him or it will use the BJP’s own weapon, Hinduism, to further fan anti-India flames in Nepal. For the purpose Oli has amassed a sea of online trolls, again just like Modi. Notably, back in 2017, he had come to power after successfully demonizing India over the blockade.  

Especially in today’s techno-space, it has become easy to subvert democracy. While government-sponsored trolls operate unhindered, its critics can be easily blocked and silenced. Indian leadership can’t digest a casual tweet of a foreign celebrity; Chinese leadership has to block any online mention of Tibet; and Nepali leaders expertly tweak the remarks of even remotely famous Indians as a direct attack on the country.

When important national issues are turned into personal wars, often by design, nothing short of complete demolition of the opponents will do. There is no middle ground online. Rihanna is completely innocent or a sworn enemy of India. Nepal will brook no compromise over Kalapani, all of which is indubitably ours. And, by the way, online space is certainly not for civic-minded folks. For their useless intellectualizing, they deserve to be blocked and hosed down.

 

Sitharaman’s high hopes

Nirmala Sitharaman, India’s first full-time female finance minister, now also has the distinction of becoming the country’s first finance minister to unveil a union budget during the turbulent Covid-19 times. Sitharaman’s budget is thus sui generis in every sense. While listing out the country’s annual incomes and expenditures, she took refuge in the words of Rabindranath Tagore: “Faith is the bird that feels the light and sings when the dawn is still dark” (Fireflies, A Collection of Aphorisms).

In 2020, the Indian economy faltered more than other big economies, pushing poor farmers back into the poverty net. During the lockdown, the union government’s Pradhan Mantri Garib Kalyan Yojana (PMGKY) provided free food to 800 million people, cooking gas to 80 million families and direct cash to over 400 million people. But that was not enough to protect many from taking their own lives due to the unbearable pain of extreme, pandemic-induced poverty.

Sitharaman’s budget is also the first of the new, challenged-filled decade. Although there are more pressing issues of ensuring food, shelter and healthcare to pandemic-hit Indians, Sitharaman tried to sidestep these priorities by trying to play up the year 2021 as India’s 75th year of Independence, Goa’s 60th years of accession to India—to celebrate which Goa got InRs 300 crores—50th year of the India-Pakistan war. She also said 2021 was the year of Chanrayaan-3 Mission and the Haridwar Maha Kumbha. These landmarks mean little to poor Indians who are looking to survive the covid crisis.

The budget that touches upon the lives of 1.3 billion Indians directly and millions more in the region indirectly is based on six major pillars: i) health and wellbeing, ii) physical and financial capital, and infrastructure, iii) inclusive development for aspirational India, iv) reinvigorating human capital, v) innovation and research and development, and vi) minimum government and maximum governance. All six pillars have been projected as foundations for AtmaNirbhar (Self-reliant) India. As Sitharaman rightly said in her budget speech, this is a continuity of the past. What she didn’t mention is that the same approach has been holding India back for decades.

By citing ThirukkuralAphoristic teachings on virtue, wealth, and love in Tamil 17th century text—on taxation, Sitharaman has positioned herself as a central BJP figure from the Tamil constituency. She mentioned: “A king/Ruler is the one who creates and acquires wealth, protects and distributes it for common good (Thirukkural 385).” But without the imagined wealth creation, it only indicates Indian people will have to struggle more to meet their basic needs while ruling party leaders keep delivering sanctimonious speeches filled with abstract couplets that do not rhyme with people’s daily challenges.

Some in Nepal have applauded India’s new budget as it marginally increases India’s allocation for Nepal and other neighboring countries. But that is a stunt in regional politics even as the budget disorients the Indian economy. Yes, Nepal may get more from the government of India this year. But a more prosperous India would have more to share with us than what we are getting from union government’s annual allocation.

There are many positive features of Sitharaman’s budget. She has put people’s health and wellbeing as her government’s number one priority, allocated money for affordable housing and elderly population, vowed to further digitize governance and public service delivery, emphasized connectivity, and most importantly, allocated enough for Covid-19 vaccination in the country. These positive aspects will add to Sitharaman’s credentials as a finance minister in these historically difficult times. But she too has been unable to depart from the conventional BJP style of playing up India’s self-imagined reliance, which is in fact impossible in the age of digital connectivity.

A former defense minister of India with a socialist bent, Sitharaman offered tremendous hope for her country. But her hopes and priorities for India already appear misplaced.