During a recent meeting between Prime Minister Pushpa Kamal Dahal and his Bangladeshi counterpart Sheikh Hasina in Italy, the latter offered Nepal its newly-constructed Payra port for third-country trade.

Dahal returned from Italy on Friday after attending the United Nations Food Systems Summit plus two Stocktaking Moment (UNFSS+2) held in Rome. The prime minister addressed various sessions and met with the UN Secretary General António Guterres and Hasina among other leaders and officials.

Besides India and China, Bangladesh has also given Nepal access to its seaports. At present, Nepal has been conducting its third-country trade via Kolkata, Haldia and Visakhapatnam ports in the southern Indian state of Andhra Pradesh.

According to a protocol agreement signed between Nepal and China, the northern neighbour has agreed to allow Nepal to use its four seaports—in Tianjin, Shenzhen, Lianyungang and Zhanjiang—and three land ports—in Lanzhou, Lhasa and Shigatse—for third-country imports. It will also allow Nepal to forward exports through six dedicated transit points between Nepal and China.

In the meeting, Hasina said Nepal would be able to use the Payra port, Bangladesh’s Foreign Minister AK Abdul Momen told the media in Italy. According to local Bangladesh media reports, the country has already opened the Chalna and Chittagong ports for Nepal and the land-locked country can use the newly-constructed port Payra as well, Momen quoted Hasina as telling Dahal.

According to the Ministry of Foreign Affairs, following the opening of the Kakarbhitta-Phulbari-Banglabandha transit route in 1997, Bangladesh has permitted Nepal to use the facilities in Mongla port for third-country trade. Bangladesh has also given an additional rail transit corridor to Nepal via Rohanpur (Bangladesh)-Singhabad (India). At present, the Bangladesh government has provided transit facilities to Nepal in Chittagong and Mongla Ports.

Upon Nepal’s request, the government of Bangladesh had agreed to provide its Banglabandha land custom station (LCS) in December last year. Despite the growth in trade between Nepal and Bangladesh over the years, Nepal has been experiencing a trade imbalance with Bangladesh in recent years, said the Nepali Embassy in Dhaka.

However, Nepal’s export value is expected to increase with the decision of the Bangladesh government to lift a two-decade-long ban on Nepali yarns entering Bangladesh via the Banglabandha Land Custom Station in December last year.

The overland trade route to Bangladesh from Kakarbhitta-Phulbari-Banglabandha has been operational since September 1997. The Government of Bangladesh agreed on August 10, 2020 to include Rohanpur as the Port of Call in the Nepal-Bangladesh Transit Agreement, according to a statement by the Nepali Embassy in Dhaka. On March 22-23, 2021, Nepal and Bangladesh signed an Exchange of Letters on the designation of the Rohanpur-Singhabad railway route as an additional transit route for the movement of traffic-in-transit between Nepal and Bangladesh and also for third-country transit trade.

According to Momen, Prime Minister Hasina said Bangladesh is developing Saidpur airport as a regional hub to enhance connectivity. Dahal praised Bangladesh’s development under her leadership, according to news reports.

There is a huge scope for hydroelectricity generation in Nepal, Dahal reportedly told his Bangladeshi counterpart. Hasina replied that Bangladesh will take steps to import more clean energy, particularly hydroelectricity, from Nepal after the beginning of the first trilateral power trade from Nepal to Bangladesh through India for 40-megawatts power.

Upon his return from Italy, the prime minister told reporters at the Kathmandu airport that there had been some important discussions with Dhaka officials on the export of electricity to Bangladesh.

Dahal and Hasina had also discussed the relations between Nepal and Bangladesh, bilateral cooperation, and the need to work together in regional forums.

Bangladesh’s willingness to purchase power from Nepal will be an important boost to Nepal’s economy, Dahal told reporters at the airport.

“Our attempt to export electricity to Bangladesh will materialise as soon as we reach a formal agreement. I held a very important discussion with the Bangladeshi prime minister on this,” the prime minister said. “She [Hasina] has invited me to take part in the independence day [function] of Bangladesh. I assured her that I will try my best [to be there].”