Nepal's ministry of commerce (MoC) has notified the Nepal Rastra Bank (NRB) that banks can now authorise letters of credit (L/Cs) with documents naming India's Visakhapatnam (Vizag) Port as a destination for imports into Nepal.

Landlocked Nepal has so far relied on the Indian port of Haldia (Kolkota) as the only port where arrangements can be made for the payment of third-country cargoes destined for the Himalayan state.

Notifications

Now it has been notified by the ministry, the central bank will issue a circular to Nepal's commercial banks allowing them to issue import L/Cs for consignments shipped via Vizag Port.

After commercial banks are notified by the NRB, imports from Vizag Port will formally commence.

Advantages

At 1,440km, Vizag Port is twice as far from Nepal as Haldia Port, but it offers distinct advantages.

Unlike Haldia, Vizag Port can handle containers and consignments can be forwarded via rail and road under the provisions of a transit treaty and railway service agreement between Nepal and India.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.