India’s venerable Kolkata Port, which handles most of Nepal’s third country trade, is set for a major makeover to stave off competition. 

The port was originally constructed by the British East India Company. It is improving its physical infrastructure and cargo handling system in a bid to be better able to compete with fast rising rival ports. The Kolkata Port Trust is facing stiff competition from Vishakhapatnam and Haldia ports in India. 

Officials at Visakhapatnam Port have urged Nepali traders to make more use of the seaport in the Indian state of Andhra Pradesh citing lower costs of ferrying goods from the port. The government has been considering opening a liaison office at Vishakhapatnam Port in a bid to speed up paperwork and customs clearance.

Binit Kumar, chairman of the Kolkata Port Trust, said that work on expanding the parking yards at Kolkata Port was moving at a rapid pace. “We have targeted completing the expansion and improvement of the port facilities in four months.”

The port’s parking yard is set to increase by 35,000 square metres from the current 100,000 square metres. This will allow the port to handle around a million containers annually. The port is currently able to process 650,000 containers, he said.

Kolkata Port mostly handles cargoes of Nepal, Bhutan and India’s northeastern states. Around 30 percent of Nepal’s total foreign trade passes through Kolkata Port. In 2017, the port handled more than 72,000 containers of Nepal. 

Port authorities have long been ignoring requests from traders, especially Nepali traders, to upgrade the 150-year-old facility. Lack of modern technology and space has resulted in massive congestion at the port. Time-consuming customs clearance and lack of loading rakes has forced Nepali traders to spend Rs50 million annually in demurrage and detention charges, they said.

Pradip Kedia, former president of the Birgunj Chamber of Commerce and Industry, said that Nepali importers had been facing problems while shipping goods from Kolkata Port. Each importer has been paying as much as Rs300,000 per container in penalties, he said. “The port authorities have opened their eyes after a long time.” 

The Kolkata Port Trust is also coordinating with the Kolkata Customs Office to set up a mechanism to reduce paperwork in a bid to eliminate hassles for traders. 

The port implemented an electronic cargo tracking system on March 1, which allows traders to track their cargo online. Traders have to pay IRs3,300 per loaded container and IRs800 per empty container to use the facility. 

Likewise, the Kolkata Port Trust has joined hands with Container Corporation of India (Concor) to set up a loading system at Majerhat, which is 14 km from Kolkata. 

Rathendra Raman, general manager of Concor’s eastern region, said that the reason for setting up a loading system was to ease congestion at the port. Last October, more than 2,000 containers were stranded at the port due to traffic congestion. 

Currently, it costs IRs125,000 to transport a container by rail from Kolkata Port to Sirsiya Dry Port in Birgunj. Shipping companies give importers 14 to 21 days to return empty containers, but most of this time is spent in complex paperwork, cargo-handling and railway loading.