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Wednesday, July 05, 2006

Trade with China through Sikkim begins

Gangtok, Jul 5: After a long 44 years, Nathu La, the famed ancient silk route connecting two Asian giants on icy trail, will reopen tomorrow for fresh border trade between India and China.

The trade, between the two countries, was closed soon after Sino-India conflict in 1962.

Sikkim Chief Minister Pawan Chamling and Tibet Autonous Region (TAR) Chairman C Phuntsak will jointly declare reopening the bilateral trade by cutting ceremonial ribbon on the Indian side of the border to mark the historic event that opens up a new diplomatic channel for cooperation, development and friendship between the two emerging economic powers of Asia.

Chinese Ambassador to India Sun Yuxi, TAR Vice Chairman Haopeng, GOC 17 Mountain Division Maj Gen K T Parnaik are expected to attend the function.

Ministers from Sikkim, top bureaucrats of the central and the state governments, businessmen, army personnel, mediapersons would also assemble at Nathu La, at an altitude of 14,200 foot, to witness the historic event that can bring a fresh bond between two neighbouring nations.

With the reopening of the trade route, Nathu La became the third point for border trade after Shiklela in Himachal Pradesh and Lipulekh in Uttaranchal.

After the route was declared open, about 100 Indian traders would cross over the international border and visit the Reqingaang trade mart in China and equal number of Chinese traders would visit the Sherathang Mart to Indian side.

Mr Chamling is scheduled to launch the trade mart at Sherathang, constructed for conducting the border trade 5 km down the road from Nathu La at a separate function.

The first step to reopen the icy pass for border trade was taken after both the countries signed an MoU during the visit of former Prime Minister A B Vajpayee to China in June 2003.

After holding several rounds of discussions, overcoming many geo-political bottlenecks and exchange of delegates by the two countries finally, a six-member delegation led by Union Additional Secretary Commerce Christe Fernadez finalised July 6 for reopening of the trade route through an agreement with the TAR authorities at Lhasa last month.

The decision indicated the change of Chinese attitude to India and its sincerity to improve the bilateral relations.

Sikkim, the land locked Himalayan state with no rail and air connectivity, whose conomic proposerity was adversely affected after the trade route was closed, has been constantly demanding for its reopening for over a decade now.

The study group commissioned by the Sikkim government to assess all aspects of the trade present a rosy picture in its report submitted to the government last year. It said the conduct of the business through this route would help to realise the Union government's goal of India's Look East policy, consolidate sub regional groupings like South Asia Growth Quadrangle (SAGQ) and Bay of Bengal Initiative for Multi Sectoral Techno-Economic Cooperation (BIMSTEC).

The two-way trade could help India to emerge as a major supplier of intermediate products for Chinese manufacturing units, give a boost to export of agricultural products on both sides, promote regional markets that link Bhutan, Bangladesh and Myanmar with other provinces of China and lead to much deeper social, political and cultural bonds.

China could also export its commodities through Kolkata and Haldia port to South East, South and Central Asian countries instead of through Myanamar port as it is more cheaper.

Neighbouring countries like Bangladesh, Bhutan and Nepal can also use the route to have access to the mainland China as it is cost effective.

The border trade it said is also likely to boost tourism, expand industrial activity, infrastructural development and revenue generation in both sides of the border.

Sikkim government is likely to get the maximum benefit.

The group led by Prof Mahendra P Lama of Jawaharlal Nehru University presented two scenarios on the volume of trade. While in case of scenario one, higher side showed that the trade flow through the Nathu La pass will be of Rs 206 crore by 2007, Rs 2266 crore by 2010 and Rs 12,203 crore by 2015.

Under Scenario two the lower side projection showed trade volume passing through Nathula will be of Rs 353 crore in 2010, Rs 450 crore in 2015 and Rs 574 crore in 2020.

The group mentioned that the state will get a revenue of Rs 1.81 crore in 2006 and Rs 3.47 crore in 2010 in the form of fee from tourists visiting Sherathang and Nathu La.

The business is likely to generate an annual revenue of Rs 14 to 70 crore from the movement of trucks by the Sikkim Nationalist Transport and private truckers at the existing rate. If the rate is doubled the annual revenue generation is likely to touch Rs 27.94 crore to Rs 139.80 crore, the group said.

In addition to revenue generation, the daily movement of trucks (now fixed at 60) from 100 to 500 in the coming years could give direct employment to 4000 to 10,000 people per annum and many others in various service sectors like restaurants, shops, hotels, telephone booths etc, it said.


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