INDIA has floated the idea of a container freight train that would operate within the member states of the South Asian Association for Regional Cooperation (SAARC).

According to a concept paper released by India and proposed to SAARC members such a container train service would run from Bangladesh to Pakistan via India and Nepal to encourage intra-regional trade.

The proposed corridor for running the train is from Chittagong Port in Bangladesh to Katihar in India, Birgunj in Nepal and to Lahore in Pakistan, reports India's Economic Times.

"The proposal being considered could unify the entire region and will lead to a seamless, borderless trade," Ram Upendra Das, senior fellow, Research and Information System for Developing Countries (RIS), was quoted as saying in the report.

He said concept would reduce transport costs and time. "All this will get reflected in product competitiveness. Increase volumes and reduce prices for consumers," Mr Das said.

This comes after SAARC member nations - Bangladesh, Bhutan, Maldives, India, Pakistan, Nepal and Sri Lanka - recently decided to work on reducing the negative list of items that are not covered under the South Asia Free Trade Area (SAFTA) agreement, which concerns the elimination of tariffs on goods traded within the SAARC region that was signed in January 2004.

During the first half of 2009 intra-SAARC trade amounted to US$377 billion.

Source: SchedNet