Border trade 'uninspiring' a year after China, India re-open Nathu La Pass

2007-07-09 09:50:31 | From:

The border trade through the Himalayan Nathu La Pass between China and India has been "uninspiring" since the historic trade route re-opened just a year ago after 44 years of closure due to border conflicts.

China and India re-started border trade on July 6 last year through the Nathu La Pass, which sits 4,545 meters above sea level and is wedged between Yadong County of Tibet's Xigaze Prefecture and India's Sikkim State.

They also opened two border trade markets - the Renqinggang market in Yadong and Changgu mart in India's state of Sikkim, which the two countries have agreed will be open between June and September every year.

"But figures show that the border trade has been uninspiring since the re-opening," said Zhang Weidong, head of the Customs of Lhasa, capital of southwest China's Tibet Autonomous Region, on Friday.

China's Renqinggang market received 574 Indian traders last year while 1,217 Chinese traders went to India's Changgu mart during the period, according to statistics from the Commerce Bureau of Yadong County.

The trade volume reached about 1.49 million yuan (196,000 U.S. dollars), including 1.04 million yuan of exports and 450,000 yuan of imports, statistics show.

Xinhua reporters saw only 11 motor vehicles and 56 traders from the Chinese side going through the Pass and 12 motor vehicles and 38 traders from the Indian side going through the Pass on July 2, which was nevertheless described as "the busiest" day by local officials since the re-opening.

An Indian official has also acknowledged the situation is far from ideal. The Minister of State for Commerce Jairam Ramesh was quoted by the country's national daily, The Hindu, in May as saying that the real issues inhibiting trade were upgrading the trade infrastructure on the Indian side and negotiating a new protocol with China which will enable cross-border trade.

"Both sides are still wedded to the concept of border trade rather than trade across the border. Our infrastructure is pathetic compared to the facilities on the Chinese side and the list of items (traded) too is severely restricted," the minister was quoted as saying.

A senior official in Tibet said just a month after the re-opening of the Pass, that the trade was running at a "low level" and was "not ideal" because "India has unilaterally imposed restrictions on trade through Nathu La."

India authorizes the export of only 29 items from India to China, and a mere 15 items are permitted to enter the Indian market from China, Hao Peng, vice chairman of the Tibet Autonomous Region, told a visiting Indian media delegation.

Such trade restrictions still exist today, local officials and traders in Yadong told Xinhua, calling for the Indian side to take actions.

In a move to change the situation, the two sides have agreed that the trade through the Pass this year should begin a month earlier (May 1) than last year and will continue until Nov. 30 compared with last year's Sept. 28.

"The two sides hope to enlarge the trade volume by increasing the duration of trade by three months," said Li Ping, director of the Commerce Bureau of Yadong County.

Statistics show that 240 Indian traders came to the Renqinggangmart and 512 Chinese traders went to the Changgu mart from May 1 to June 28, generating a trade volume of 455,700 yuan.

On the other hand, analysts and officials in Tibet say that it is still too early to conclude whether or not the re-opening of the Pass has been successful just by looking at the trade volume figures.

"The re-opening of the Pass and the trade volume achieved within just a year are at least a good start for the two sides, considering the trade route had once been closed down for 44 years," said Gao Shangde, deputy director of the Tibet Regional Commerce Department.

He said that the Indian commerce authorities and the Sikkim State are upgrading the roads leading to the border trade mart and the infrastructure of the mart in an effort to boost the trade.

"We still need time for the growth of border trade," he said.

Trade through Nathu La Pass accounted for 80 percent of the total border trade volume between China and India in the early 1900s. But following their border conflict in 1962, the two countries closed their customs at former border trade markets and the trade route became a tightly guarded frontier with barbed wire.

It was toward the end of the 20th century that Sino-Indian ties saw improvement, and the two countries agreed in 2003 to reopen border trade markets on the two sides of the Nathu La Pass.

Before the Pass was re-opened last year, 90 percent of the goods were shipped by sea, and by way of Tianjin - a port city some 120 kilometers from Beijing but 4,400 kilometers from Lhasa. With Nathu La Pass re-opened, it is only 1,200 kilometers by land from Lhasa to Calcutta, a major coastal city of India.

Statistics from China's Ministry of Commerce show that the trade volume between China and India surged to 24.9 billion U.S. dollars in 2006 from only 2.1 billion in 2000, making China the second biggest trade partner of India, and India was China's 10th largest trade partner.

While Tibet achieved 290 million U.S. dollars of foreign trade in 2006, a year-on-year increase of 40.7 percent, according to statistics from the Tibet Regional Commerce Department.

Border trade exceeded 157 million yuan (20 million U.S. dollars), up 28.71 percent from 2005 and representing 54 percent of the region's total foreign trade volume, statistics show. But the trade volume between Tibet and India was not available.

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