In an obscure corner on the Barkor, a famous market street in the heart of Tibet's capital Lhasa, stands a centennial store that sells Nepalese handcraft items ranging from Buddha statues and ornaments to thangka paintings.

Local Tibetans call the store "Shamo Garbo," meaning "white hat," because the Nepalese man who opened it more than 100 years ago always wore a white hat and his name was too difficult for the locals to pronounce.

The present store owner, Ratna Kumar Tuladhar, is the man's great grandson.

"In my younger days I had to trek many days from Kathmandu to Lhasa in the Himalayas. Today, the two cities are linked by mountain roads and daily flights," said the 50-year-old.

China's three leading airline companies China Eastern, China Southern and Air China all operate passenger flights to Kathmandu.

Easier and cheaper transport has cut costs, offering a larger profit margin as well as discounted prices for the customers, he said.

As China steps up trade and economic cooperation between its southwestern region and the neighboring countries including Nepal and India, more businesspeople have invested in Tibet, said Su Yuanming, an official in charge of border trade at the regional commerce department.

"Such cross-border cooperation is conducive to Tibet's economic development and the overall growth of China's underdeveloped western regions," he said.

Tibet reported 254 million U.S. dollars of border trade in the first eight months of this year, up 88 percent year-on-year, said Su.

He said trade with Nepal took up 95 percent of Tibet's border trade. "Last year, Tibet reported 249 million U.S. dollars of bilateral trade with Nepal."

Meanwhile, trade with India totaled 16.3 million yuan (2.44 U.S. dollars) last year, at least 10 times the 2006 volume, thanks to the 2006 reopening of Nathu La Pass, a historic trade route wedged between Yadong County of Tibet's Xigaze Prefecture and India's Sikkim State.