Nepali traders are delighted by China’s decision to reopen the northern border that has remained closed for three years, but insiders say it may be too soon to celebrate as Beijing's policy has been inconsistent.

Following a meeting of the Nepal-China border trade mechanism in Lhasa on March 29, China on Saturday decided to fully open the Rasuwagadhi-Kerung border point.

Located directly north of Kathmandu, the Nepali check post of Rasuwagadhi is 24 km from Kerung in China.

“It’s a big relief for Nepali traders. It will help save import-export costs and time,” said Ashok Kumar Shrestha, president of the Nepal Trans Himalayan Border Commerce Association. “We expect that there will be no hassles in the trade in the coming days,” he said.

Some traders say that Chinese border points have a habit of opening and closing randomly, causing them much distress. They have called for a consistent trade and transit policy.

“As people’s movement has also been allowed, it will help small traders to bring goods as per their capacity,” Shrestha said.

Traders say that shipments dispatched from Guangzhou to Nepal over the northern overland route normally arrive in three weeks. According to Shrestha, cargo sent by sea to India for transit to Nepal takes seven weeks.

Officials say that 14 containers are arriving in Nepal daily. “We expect that the number will go up now.”

Trade economist Posh Raj Pandey said, “The hassles at the border were caused mainly by the Covid pandemic; and now that trade has resumed, it’s good for Nepal.”

Pandey added, “It looks like China works from a long-term perspective and has prioritised the Rasuwagadhi trade point. But the infrastructure on the Nepali side is out of order.”

He said, “Nepali freight carriers should be allowed to transport goods to the warehouse in China. Easing visas and entry permits will help Nepali traders do hassle-free trade with China.”

According to him, the Nepal government needs to build a lab to issue sanitary and phytosanitary certificates and sign an agreement with China on mutual recognition of major exportable goods from Nepal.

On April 1, Chinese Ambassador to Nepal Chen Song twitted: “Passengers' clearance at the Jilong (Rasuwa) port has been resumed from today. I believe this will further deepen the bilateral cooperation and people-to-people exchange.”

Madhu Kumar Marasini, secretary of Nepal’s Ministry of Industry, Commerce and Supplies tweeted, “We are equally hopeful that this reopening will reflect in improved bilateral trade, tourism and passenger movement and help further deepen bilateral collaboration.”

Shrestha said they had been informed that the Tatopani border point would also come into full operation from May 1. “We have been informed that the trading point will be fully opened, but people’s movement at Tatopani point is expected to be delayed.”

Traders say China has reopened trade at a time when demand for goods is slow.

“Trade demand is subdued. There are no large orders for Chinese goods at this time because of high bank interest rates and inflation,” said Shrestha. “There is no demand at all.”

Narayan Prasad Bhandari, chief of the Rasuwa Customs Office, said 25 containers loaded with exportable goods crossed the border on Saturday while 32 empty goods carriers reached Kerung to take on import cargo.

“The export goods consist of statues, carpets, bamboo products, handicrafts and copper decoration items,” Bhandari said.

Readymade garments, rubber, footwear, electronic goods, hydropower equipment and other goods are imported from China.

“There has been no passenger vehicle movement,” Bhandari said. “Rasuwa residents will receive a pass to cross the border like before. Chinese officials have said that two-way trade will be allowed through the Tatopani border point from May 1.”

Nepali and Chinese officials have also agreed to fully open the Hilsa border point in Humla district from May 1.

Bijay Lama, a tourism entrepreneur in Humla, said the border point would be fully opened for two-way trade and movement of people. “But the movement of third-country nationals will be restricted at the border point,” Lama said.

Humla residents who used to travel to Taklakot in Tibet for trade hope the opening of the transit point next month will help revive the commercial activities stalled by the pandemic.

Min Lama, president of the Humla chapter of Hotel Association Nepal, says the decision has provided hope for the revival of trade and tourism in the district.

“However, they have not mentioned passenger movement through the border point,” said Dayananda KC, chief of the Tatopani Customs Office.

“Around 10 Chinese containers are arriving at the border point daily, and 80 percent of the goods arriving through Tatopani customs are apple and garlic,” KC said. “The number of containers coming to Nepal was around six, but it increased after January.”

According to the Rasuwa Immigration Office, Chinese authorities issued permission letters to 250 people on Saturday after a break of 38 months.

Chinese officials have said that there will be no hassles in trade and passenger movement at the Rasuwagadhi border point. Antigen tests of container drivers, workers and traders are being done.

According to the Department of Customs, imports from China to Nepal declined by 21.68 percent to Rs145.78 billion in the first eight months of the current fiscal year ended mid-March.

Nepal imported goods worth Rs264.78 billion in the last fiscal year 2021-22.

Last December, China decided to resume two-way cargo movement through the Rasuwagadhi-Kerung-Jilong port in January. But exports from Nepal were allowed to pass only on a fortnightly basis.

After Nepal’s repeated requests, the Chinese side in July agreed to resume two-way trade through the border point.

Nepal’s exports to China fell by 4.85 percent to Rs519.36 million in the first eight months of the current fiscal year.

The country exported goods worth Rs808.75 million in the last fiscal year.

Nepal’s trade deficit with China reached Rs145.26 billion in the first eight months of the current fiscal year.

Nepali traders, who suffered huge losses due to the disruption in cargo movement, have long been demanding full-fledged resumption of exports and imports through the Rasuwagadhi-Kerung-Jilong and Tatopani-Zhangmu border points.

Initially, China closed the border point in early 2020 because of heavy snowfall and the Lhosar festival.

After the coronavirus outbreak was declared a pandemic by the World Health Organisation on March 11, 2020, countries were compelled to close their borders and impose lockdowns to prevent the disease from spreading.