Bangladesh, Bhutan, India and Nepal (BBIN) on Monday signed a Motor Vehicles Agreement for seamless movement of people and cargo among the neighbours.

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2. BBIN Motor Vehicle Agreement (MVA)
Bangladesh,Bhutan,IndiaandNepal (BBIN) onMondaysigneda Motor VehiclesAgreement for
seamlessmovementof people andcargoamongthe neighbours.
The Motor Vehicle Agreement(MVA)withinthe sub-groupingof the SouthAsianAssociationfor
Regional Cooperation(Saarc) nationswouldincreaseeconomicbenefitsforthe region,Transport
MinisterNitinGadkari said.
Thispact is the firststage of the $8-billionroadconnectivityprojectsettobegininOctober.Myanmar
and Thailandhave agreedtodevelopamotorvehicle pactonlinesof the draft Saarc Motor vehicle
agreement,topave the wayfor greatereconomiccooperationinthe Associationof SoutheastAsian
Nations(Asean) region.
Gadkari said: “Thisagreementwill promote ourcooperationintrade andcommerce,alongwith
cementingourage-oldcultural ties.The overarchingframeworkof thisagreementwill needtobe
followedthroughwithformulationof the requiredprotocolsandprocedurestorealise freemovement
of people andgoodsinthe region.Thiswouldfurtherneedtobe supplementedthroughbuildingand
upgradingroads,railwaysandwaterwaysinfrastructureenergygrids,communicationsandairlinksto
ensure smoothcross-borderflow of goods,services,capital,technologyandpeople.Takentogether,this
providesenormousopportunityforintegrationanddevelopmentof ourregion.”
A BBIN FriendshipMotorRallyhasbeenplannedinOctober2015 to highlightthe sub-regional
connectivityandthe scope andopportunitiesforgreaterpeople-to-people contactandtrade underthe
BBIN initiative.
The MVA wouldreduce transportcostsand fosterdevelopmentof multi-modal transportandtransit
facilities,enablingincreasedconnectivityandpromotionof greatertrade betweenthe fourcountries.
Accordingto an agreement,the fourcountrieswouldcarryouta six-monthworkplanfromJulyforthe
implementationof the BBIN MVA inaccordance withthe agreementsandprotocols.The staged
implementationof the historicpactwouldbegin inOctoberthisyear.
Secretary-level discussionswere successfullyconcludedinBengaluruthismonthandaconsensus
reachedonthe textof the agreement,he added.“Onconclusionof thisagreement,oursub-regionwill
getaccess to the largerASEAN marketthroughseamlesspassengerandcargomovement.”
The agreement will allow motor vehicles to transport persons and cargo through each country
more easily, reversing decades of frustration for businesses that conduct overland trade between
BBIN countries.

3. The deal is designed lift the geopolitical constraints that have hindered the flow of people and
goods through BBIN countries. It will focus on increasing transport options between these
countries, creating strategic trade partnerships and ultimately boosting the regional economy.
The agreement will help the Northeast India region – comprised of Arunachal Pradesh, Assam,
Manipur, Meghalaya, Mizoram, Nagaland and Tripura states – develop considerably; however,
the agreement will also allow mainland India businesses to develop more cost and time effective
supply lines and distribution channels for the region.
The BBIN MVA will streamline the process of acquiring cross-border permits. However,
permitted travel will remain limited to pre-designated routes after the BBIN MVA is
implemented. Meanwhile, MVA signatories are committed to developing better overland
transport infrastructure between BBIN countries.
Government officials expect to finalize the BBIN MVA by the end of 2015. The authorities are
rolling out the details of the agreement in several phases from July. Between July and
September, officials will negotiate, outline and sign the state-to-state or regional agreements
needed for the BBIN MVA. By December, officials expect to have agreed on the infrastructural
and regulatory mechanisms needed to implement the BBIN MVA.
The primary benefit of the BBIN MVA for India-based companies is the ability to travel through
Bangladesh. Although India and Bangladesh already have a vehicle transport agreement between
the countries, authorities restrict vehicles from traveling more than 93 miles (150 km) across the
border. Transporters that want to ship goods beyond 93 miles of the border need to transfer the
goods to another vehicle to complete the journey.
To avoid this logistical challenge, some transporters simply prefer to drive around the problem.
A manufacturer in Kolkata, West Bengal state that needs to deliver product to Agartala, Tripura
state, for instance, can either plan for multiple permits and transport operators to reach Agartala
directly through Bangladesh or a 1,000 mile (1700 km) journey around Bangladesh. When the
BBIN MVA takes effect, that same manufacturer can use one transporter for a 280 mile (450
km) trip through Bangladesh without the current administrative burdens.
The BBIN MVA will significantly ease the transport of goods from mainland India to Northeast
India’s economic centers, namely Agartala, Guwahati, Assam state and Shillong, Meghalaya
state. Poor infrastructure, difficult terrain and geopolitical constraints have kept the Northeast
underdeveloped and isolated for many years. However, Northeast India remains wealthy in terms
of natural resources, while its markets remain untapped.
Northeast India contains 30 percent of India’s freshwater reserves. This access to water has
allowed hydropower operations and the agricultural industry to develop in the region, but this
development has not reached its full potential. The region’s rubber, bamboo and food processing
industries will grow significantly because of the MVA.
Industrial development also becomes a viable option for the region due to lower transport costs
and its access to comparatively cheap labor. The region has navigable rivers, but currently lacks

4. direct access to any port. With the opening of roadways to Bangladesh, manufactures will find it
easier to transport products to ports in Chittagong, Bangladesh or larger urban centers in India.
Important Stepping Stone
Northeast India will benefit significantly from the BBIN MVA, but the integration of the BBIN
economies will profoundly affect South Asian trade flows. Some estimate that trade across South
Asia will increase by 60 percent because of the BBIN MVA. Accordingly, the BBIN MVA is not
only a stepping stone to improve investment in Northeast India, but also South Asia.