Nepal's Terai party wrests tax relief for Indian transporters

Kathmandu, Sep 30 (IANS) Nepal's debutant Terai Madhes Loktantrik Party (TMLP), which emerged as the fifth largest party in the April general election, has been able to wrest a major tax relief for Indian vehicle owners, especially transporters, plying along the border.

The TMLP, formed by former ministers and lawmakers from national parties to espouse the cause of Madhesis - people of Indian origin living in the Terai plains, paralysed the interim parliament Monday and relented only after Finance Minister Baburam Bhattarai agreed to withdraw the new cess imposed on Indian vehicles entering Nepal even for a very brief period.

Last year, the then finance minister Ram Sharan Mahat had waived tax on Indian vehicles that entered Nepal provided they returned within 24 hours. India also reciprocates the gesture for Nepali vehicles entering India for a day.

However, this month, the first Maoist budget unveiled by Bhattarai slashed the waiver, partly in a bid to raise funds for the ambitious budget and partly to regulate traffic in the border areas.

Soon after the diktat, protests erupted on the Indian side of the border, with the ruling Bahujan Samaj Party (BSP) of India's Uttar Pradesh state and other Indian organisations demonstrating against it.

The TMLP took up cudgels on behalf of the protesters, obstructing the constituent assembly - Nepal's interim parliament - and demanding that the decision be revoked.

Hridyesh Tripathi, a former minister and powerful Terai MP, said the tax would hit the passage of goods from India and would affect people living along the border, creating red tape and additional complexities.

Also, people living in the border areas have relatives in both countries and are wont to travel across the border for education, work and medical treatment oftener than travelling to Kathmandu.

Finally, the finance minister gave an undertaking in writing late in the evening, agreeing to withdraw the levy on Indian vehicles that entered Nepal only for a day.

Transporters on both sides of the border have also been complaining of lack of security and extortion by both security and customs officials as well as political parties.