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India and Nepal are close neighbors having a strong friendly trade relationship. India is Nepal’s biggest trading partner, supplying many goods like fuel, medicines, and machinery to Nepal, while Nepal also exports to India many products like carpets, tea, and clothing.
Trade between the two countries is very big, with the trade that has happened reaching over NPR 1,13,453 crore in 2022-23. This trade is the livelihood of many people as their jobs, it also increases the countries’ economies, improves development, also strengthens the bond between the countries.
To transport goods properly, swiftly and securely, logistics companies in Nepal like our Cargo Nepal play a key role making sure that smooth and timely deliveries are done.
Choosing the right shipping method is pretty important for making sure that a safe trade happens when shipping from India to Nepal or Nepal to India.
Here are the main options when shipping:
Road transport is the most commonly used and cost-effective method for moving cargo into Nepal. It provides flexibility and easy accessibility, making it ideal for shipping both bulk goods and time-sensitive deliveries. Trucks and containers regularly move across well-established road networks, making this the backbone of Nepal’s import-export system.
Nepal shares a long and open border with India, and over 90% of its international trade is conducted through these road routes. Major entry points include Birgunj (via Raxaul, India)—the largest trade gateway—followed by Bhairahawa (Sunauli), Kakarbhitta (Panitanki), Biratnagar (Jogbani), Nepalgunj (Rupaidiha), Dhangadhi (Gauriphanta), Mahendranagar (Banbasa), Krishnanagar (Barhni), Jaleshwar (Sitamarhi), and Malangawa (Sonbarsa).
Road transport is primarily used for the movement of goods such as textiles, clothing, machinery, construction materials (cement, iron, tiles), electronics, food, and other essential items. The method is especially popular for shipping perishable goods and bulk commodities, as it provides quick and efficient delivery. This system of transportation supports many types of industries,
Rail transport in Nepal is an efficient and cost-effective option for shipping heavier and larger shipments, especially bulk goods. It is most commonly used for items that are too large or heavy to be transported by road or air, thus providing a reliable option for long-distance shipping. The rail network in Nepal connects key trading hubs, such as Biratnagar and Bhairahawa, with India, facilitating the transportation of goods between the two countries.
Key rail entry points with depots in Nepal include Birgunj (Sirsiya Inland Container Depot), which is the country’s primary dry port connected to Raxaul in India, as well as Biratnagar, which is linked to Jogbani, and Bhairahawa, that is connected to Nautanwa. These depots serve as important locations for the handling, storage, and distribution of cargo. Other emerging or proposed rail entry points include Nepalgunj Road (near Rupaidiha) and Kakarbhitta (connected to Naxalbari), which are expected to improve Nepal’s freight capacity more in the future.
This transportation method is mainly used for transporting raw materials, construction equipment, coal, cement, and large machinery that require more space and can handle heavy loads during transit.
Air freight is the fastest method of transportation, making it the preferred option for delivering urgent, time-sensitive, and high-value goods. Due to its speed, it is primarily only used for items that need to reach their destination quickly, such as electronics, pharmaceuticals, perishable goods, and luxury items.
In Nepal, Tribhuvan International Airport in Kathmandu serves as the main hub for handling air cargo, especially for shipments arriving from India. Although it is more expensive than road or rail transport, the speed and security air freight provides make it important for businesses dealing with valuable and perishable goods that cannot afford delays or risk.
Each method has its own benefits, and businesses many times use a mix of different methods according to their needs for faster, safe and proper delivery.
To clear customs in both India and Nepal, shippers and importers must provide the following essential documents:
These documents are necessary for goods leaving India to Nepal:
If using the road method, a lorry receipt (LR) is needed.
If using the rail method, a railway receipt (RR) is required.
If using the air freight method, an Airway Bill (AWB) is needed which will serve as proof that shipment happened.
This invoice details the necessary information like seller's, buyer information, product description, unit price, total value, and payment terms.
This invoice is also used by customs to calculate the duties and taxes.
This list contains package details like the package weight, volume, and quantity.
This list helps customs officials to verify the shipment.
This certificate certifies that goods were made in India.
A document verifying the country where the goods were manufactured
This is also required to qualify for preferential tariff rates under trade agreements.
Filed with Indian customs for approval before the shipment leaves.
This form also helps to track exports and make sure they follow the compliance.
If the goods are insured, this certificate provides coverage proof.
Required in case of damage/loss during transit.
Sent before finalizing a deal.
While not always submitted to customs, it’s many times used to initiate the export process.
For restricted goods, an export license may be necessary from DGFT (Directorate General of Foreign Trade).
Some shipments may require inspection from an authorized agency to make sure that they meet export quality standards.
A mandatory registration number for businesses involved in international trade:
Approval from Nepal Rastra Bank allowing foreign currency transactions for exports.
These documents are documents that are required for customs clearance upon arrival in Nepal:
This form must be submitted by the importer to Nepal Customs.
This contains details of goods, value, and tax obligations.
Importers must be registered with Nepal’s tax authorities to pay customs duties.
LOC is used for international payments if required by the trade agreement.
It's a secure payment method used to pay foreign suppliers for imported goods
Certain goods (such as special food, chemicals, or electronics) need special import permits from Nepali authorities.
Sometimes referred to interchangeably with CED, but ensure it's aligned with Nepali Customs' current form structure.
Issued by the carrier/forwarder, it allows the consignee to take delivery of goods from the port/ICD.
Nepal Rastra Bank and Department of Commerce may require an import license for some goods.
Particularly relevant for agricultural/organic/chemical goods.
Nepal places different import duties and taxes on goods entering the country.
We listed the required custom duties and taxes in Nepal below:
Customs Duty – This duty changes according to the product type, usually between 5% and 40%.
Value-Added Tax (VAT) – A 13% VAT is applied to most imported goods.
Excise Duty – This duty is applied to specific items like alcohol, tobacco, and luxury goods.
Agricultural Reform Fee – This is charged on imported agricultural products.
Special Import Duties –Some goods may need additional tariffs.
Customs Tariff Database (HS Code Reference) - Nepal uses the Harmonized System (HS). The customs officer checks the invoice and classifies the goods under the HS Code (Harmonized System Code), which is an internationally standardized system used to classify goods for customs purposes._
Environmental Tax (for some electronic/plastic items) - There’s a small green/environmental tax on certain environmentally harmful goods.
To avoid any penalties or shipment holds, importers must make sure that they do timely tax payments.
Register the shipment with Indian Customs using the ICEGATE portal
Submit necessary documents like Shipping Bill, Invoice, Packing List, and Certificate of Origin
Pay applicable export duties if any and obtain clearance
Payment to Supplier: TT or LC (Telegraphic Transfer or Letter of Credit) is commonly used to securely pay the supplier before or during the export process
The shipment is handed over to the transporter such as truck, rail, or air cargo
Goods are moved to an Integrated Check Post (ICP) at the India-Nepal border
E-Way Bill is required if using road transport for goods over a certain value; even for cross-border, road transport within India up to the border requires this
Customs clearance is completed at the border ICP such as Raxaul or Jogbani where India hands off to Nepal Customs
Seal Verification at ICP: Indian customs may seal the container and verify it at the ICP to ensure it hasn't been tampered with
Importer submits the Customs Declaration Form (CED) to Nepal Customs
Once the shipment arrives, the documents are submitted through the ASYCUDA system, an electronic platform used by Nepalese customs to manage and process import and export documents efficiently
Customs officials check the shipment and verify the documents
Import duties and VAT are calculated and must be paid
Once cleared, the goods are released for final delivery
The customs officer checks the invoice and classifies the goods under the HS Code, which helps determine the correct duty and taxes such as excise duty or environmental charges
Handover at ICP such as Birgunj or Biratnagar: goods first arrive at the Integrated Check Post in Nepal where customs processing begins
Inspection Types: there are usually three levels — Green Channel (no inspection), Yellow Channel (document check), and Red Channel (physical inspection)
Customs Agent or Clearing Agent: most importers use a licensed customs broker or agent to handle this process
Going through the customs and documentation for shipping from India to Nepal needs careful planning. Making sure that all required documents are accurate and complete can help avoid unnecessary delays, extra costs, or penalties.
Working with reliable shipping partners like us Cargo Nepal who guarantees you with 100% shipping rates is also a smart and best option as we will handle all your customs procedures smoothly, thus providing you with a fast and worry-free shipping.
Shipping costs can significantly impact businesses shipping goods from India to Nepal. Here’s how you can reduce these expenses:
Distance & Route: Longer distances and more difficult routes will need more costs compared to shorter and easy routes.
Mode of Transport:
Road Transport: This method is most cost-effective for shorter distances.
Rail Transport: This is suitable for bulk shipments but is slower than air.
Air Freight: This is faster than other methods but is also more expensive.
Weight and Volume: Heavier or bigger shipments cost more money to transport than smaller ones.
Customs Duties & Taxes: These duties & taxes will change depending on product type which will affect the overall cost.
Plan Shipments Early: Try to plan early and avoid last-minute shipping as they can be more expensive due to urgency and limited time.
Use Bulk Shipments: Pack the goods properly and ship them in a bulk to lessen shipping costs.
Negotiate Rates: Work with freight forwarders companies like our Cargo Nepal to get better rates as well as 100% guarantee service.
Choose the Right Shipping Mode: Go for the cheaper option like road method for non-important shipments to save on costs.
Optimize Packaging: Try to package properly as much as you can by reducing the package size and weight to lower shipping fees.
By understanding all these cost factors and applying these strategies properly, businesses can reduce shipping expenses while also doing fast and reliable delivery.
Shipping goods across borders, such as from India to Nepal, creates and gives unique challenges that are very difficult to handle most of the time. However, with the right strategies, businesses can overcome these obstacles to ensure smooth and efficient deliveries.
Here’s an overview of the common challenges and possible solutions:
Challenge:
There are challenges such as customs procedures can be quite difficult to follow along and understand
There will be requirements for multiple documents like commercial invoices, certificates of origin, and bills of lading which is very difficult and worrying to do alone.
Any missing or incorrect documentation may just lead to unnecessary delays which will affect shipping along with extra fines.
Solutions:
The best solution for you will be to work with experienced freight forwarding companies like our Cargo Nepal, we are familiar with all customs requirements and will make sure you will get a 100% shipping guarantee with no-problem at all whatsoever.
Make sure that you double check to ensure that all paperwork is accurate and submitted in a timely manner to avoid delays.
Challenge:
Another challenge is the changing exchange rates between Indian Rupees (INR) and Nepali Rupees (NPR) which can affect the cost of shipping and overall budget planning.
Solution:
Plan shipping costs by keeping a specific time for exchange rate change.
Work with financial institutions that can provide you with decent exchange rates.
Challenge:
Another challenge is the delays that can occur when doing Cross-border shipping due to factors like road conditions, customs inspections, or political instability.
Solution:
Go for reliable carriers with a good track record in cross-border shipping like our Cargo Nepal.
Have backup plans in case of emergencies, such as using other routes or having backup transport methods.
Challenge:
Another challenge is that different countries have different regulations on the types of goods that can be shipped, such as restrictions on dangerous materials or short-lived goods.
Solution:
Make sure to properly follow both Indian and Nepali regulations before shipping.
Work with logistics experts like our company Cargo Nepal to handle the legalities and make sure that your goods meet local standards.
Challenge:
Language differences between the two countries can cause miscommunication, especially when dealing with customs or local authorities which is another challenge to handle.
Solution:
Employ staff that knows both languages or get translation services to handle communication.
Use logistics partners that are familiar with both languages to reduce misunderstandings.
Challenge:
Long-distance shipping across borders is rather risky as there is risk of goods being damaged or lost during shipping.
Solution:
Do quality packaging to protect goods from being damaged.
Go for insurance to cover any potential losses or damages that may happen in future.
By understanding and handling all these challenges, businesses like yours can easily complete the cross-border shipping process and have a fast, reliable and safe delivery of goods from India to Nepal.
Shipping goods from India to Nepal is somewhat difficult and may cause worry due to the various logistics, customs regulations you will need to take care of, and which transportation method to choose, all which will be stressful to do. However, with the right planning and strategic approach, businesses can still be able to have a fast, reliable and safe shipping process.
To make your cross-border shipping process successful, it is important for you to choose the best freight forwarders and logistics providers like our Cargo Nepal, we specialize in handling all the process of international shipments.
Additionally, businesses should also continuously monitor the shipment process to create solutions for any issues that arise quickly. Finally, we will end this blog by saying that doing proper shipping is very important as if your goods reach their destination on time and in good condition it will not only strengthen your business operations but it will also boost your customer satisfaction and trust and make them a returning customer.
