Disentangling transit costs and time in South Asia

Research reports and studies
December 2015
Author: Prabir De, Reviewer: Marie-Agnes Jouanjean
Under the overarching research theme of the impact of regional infrastructure for trade facilitation on growth and poverty reduction, this study attempts to identify the trade barriers that impede the trade flow of Nepal and Bhutan through the gateways ports of Kolkata and Haldia in India.

This case study focuses on the impact of transit regulations and agreements on the cost of services required to transit goods between the ports and Bhutan or Nepal. The primary objectives are as follows:

(1) to identify trade costs (particularly those produced by administrative, transport, regulatory, financial and procedural barriers) that affect the flow of goods between the two ports and Bhutan and Nepal; 

(2) to compare the cost and length of time taken to get a similar product out of the ports and on the road to the gateway importer (India) and to each of the landlocked countries (Bhutan or Nepal).

Attention is given to how the two landlocked countries are affected by the cost of transit services; which trade costs vary most significantly; and how firms are affected by the cost of transit services.