India has agreed to lift weight restrictions on cargo trucks in the Kakarbhitta-Fulbari-Banglabandha corridor, allowing Nepali freight movement to be treated on par with Indian freight.

This was agreed upon on Friday during the Nepal-India meeting of the Inter-Governmental Committee (IGC) on Trade, Transit, and Cooperation to Control Unauthorised Trade, held in Kathmandu.

The Indian side agreed that as per the prevailing regulations, maximum axle weight of 18.5 tonnes for two axle vehicles and 28 tonnes for three axle vehicles may also be applicable to Nepali vehicles to ply on the corridor.

The two countries also agreed to advance the process of mutual recognition, certification, testing, and quality determination of goods by enhancing cooperation between the Nepal Bureau of Standards and Metrology and the Bureau of Indian Standards (BIS).

According to a statement by Nepal’s Ministry of Industry, Commerce, and Supplies, India has agreed to fast-track the process of providing new BIS certification for Nepali goods exported to India and renewing the permits.

“We raised the BIS certification issue seriously during the meeting, as the export of Nepali cement, plywood, footwear, zinc sheets, and other goods to India has been halted for months due to delays and non-renewal of BIS certificates,” said Gobinda Bahadur Karkee, secretary at the industry ministry.

India reportedly has agreed to prioritise and facilitate this process.

Karkee from Nepal and Sunil Barthwal, secretary at the Ministry of Commerce and Industry from India, led the meeting.

During the meeting, India agreed to conclude the letter of exchange initiated by Nepal on the amendment of the Nepal-India Transit Treaty, which will allow all cargo transport through railway facilities in Biratnagar and Bhairahawa.

Nepal reiterated its request to use Mundra Port in Gujarat and Dhamra Port in Odisha, along with the permission to facilitate import-export of goods from the Kolkata airport to third countries. The two sides also agreed to finalise letters of exchange to address changes in transit routes in case of difficulties.

For Nepal, the nearest seaport is Kolkata. India and Nepal signed a ‘Treaty of Trade and Transit’ in 1960 to provide transit facilities to Nepal. This treaty is renewed periodically.

Additionally, Nepal and India agreed to expedite the preparation of a detailed project report (DPR) for two motorable bridges over the Mahakali river to enhance trade. These bridges, to be built with Indian grants, will connect Jhulaghat in Baitadi and Sirsha in Dadeldhura.

India also responded positively to Nepal's request to include additional fruits, flowers, vegetables, and herbs in its Plant Quarantine (Regulation of Import into India) Order. Only the listed items can be exported to India.

According to the statement issued by the Indian Embassy in Kathmandu on Sunday, in response to Nepali side’s requests, the Indian side agreed to include Sal seeds and Chayote in the Plant Quarantine Order of India.

Similarly, Jatamasi-root extract, Sugandhkokila berry extracts, Sugandhwal Rhizome extract and Timur berry extracts have been accepted into the list of processed items [plant products], the embassy said.

During the bilateral meeting, the Indian side highlighted the problems faced in milk exports to Nepal.

The Nepali side agreed to consider the request of the Indian side positively for milk products not adequately produced in Nepal such as whey and cheese, the embassy said.

Karkee said that Nepal requested the Indian side to fully utilise the Integrated Check Posts (ICPs) at the Nepal-India borders and create an environment where all goods could be transported smoothly.

Both sides agreed to advance mutual recognition and certification processes, testing, and quality determination of goods through collaboration between Nepal’s Department of Food Technology and Quality Control and India’s Food Safety and Standards Authority.

Discussions were also held to harmonise standards in food, quality, and metrology.

“The Indian side currently does not accept online certificates of origin and requires hard copies. We requested that they accept online certificates to facilitate Nepali exporters,” Karkee added.

Key treaties, including the Trade Treaty (2009), Transit Treaty (2023), and the Unauthorised Trade Control Agreement (2009), were discussed in detail.

India also agreed to facilitate importing equipment and other goods from India required for projects in Nepal with Indian investment.

“India reported facing difficulties importing equipment for hydropower projects in Nepal. As the issues relate to Nepal’s customs department and the finance ministry, we assured them of necessary facilitation,” said Karkee.

The meeting agreed to simplify the customs process for importing from India livestock-related food items that are not produced domestically. Both sides agreed to address related matters promptly through the respective mechanisms.

Given the importance of the Nepal-India partnership in trade and investment, both sides emphasised the need for regular discussions and meetings to strengthen existing mechanisms.

India remains Nepal’s largest trading partner and primary source of foreign investment, providing transit for nearly all of Nepal’s third-country trade.

According to the commerce wing of the Indian Embassy in Nepal, India accounts for about two thirds of Nepal’s merchandise trade, one third of trade in services, one third of foreign direct investments, nearly 100 percent of petroleum supplies, and a significant portion of inward remittances.

In the last fiscal year, trade between Nepal and India amounted to Rs1.09 trillion. However, Nepal’s exports to India declined by 3.28 percent to Rs103.17 billion in 2023–24, compared to the previous fiscal year.

According to the Department of Customs, imports from India decreased to Rs996.68 billion, down from Rs1.02 trillion in the prior fiscal year.