Rickshaws and trucks on the Indo-Nepal border.
flickr / junn-sato
Rickshaws and trucks on the Indo-Nepal border. flickr / junn-sato

Smugglers’ paradise

Life and lucre on the open border between Nepal and India.

The night bus had arrived early at Birgunj, on the Nepal side of the Indo-Nepal border, a rare occurrence that I was not able to appreciate fully because it was 4:30 in the morning, and the city was still slumbering. Trying to figure out what to do with myself, I turned to Bikas, a friend I had just made on the bus journey. "Which way is the border?" I asked. "About 15 minutes down that way," he replied, pointing down a deserted road that dissolved into darkness. "Would you like to see it?"

We found a rickshaw heading toward the border and set out south. As we rode, the early morning began to crack through the night. Along the road, open fields dotted with unremarkable cement buildings slowly came into view in the pinkish light. A tonga carrying a few passengers passed our rickshaw, and Bikas flagged it down. "How about some tea?" he asked as we climbed aboard. A few minutes down the road, Bikas pointed to a wooden archway: "That's the gateway of Nepal." Confused, I asked where we were going. "To India," he responded, "to drink tea."

Our tonga was no longer in Nepal, but it was also not yet in India. We were passing through a no-man's land, a hazy patch of earth that does not officially belong to either country. The sprawling Gangetic plain extended outward on either side of us, and it was not clear where one country ended and the other began. On the far side, an Indian border official stopped our cart. The other passengers in the cart were either Indian or Nepali and, unlike me, did not require a passport for the crossing. Bikas explained that he and I were heading to India just briefly, to drink some tea, and the official waved the tonga on. And just like that, we had arrived in Raxaul, Bihar. We drank our tea, and then crossed back into Nepal.

This porousness and lackadaisical attitude thrives all along the Indo-Nepal border, and is of considerable anxiety to both the Nepali and Indian government. Since an open border was created under the Indo-Nepal Treaty of Peace and Friendship of 1950, this frontier has become one of the world's major smuggling hubs, due both to its length and to its strategic location as a crossroads between West Asia, China, Southasia and Southeast Asia. Gold, guns, watches, electronics, tractors, cars, mechanical parts, rice, sugar, fertiliser, ready-made clothes, liquor, drugs, perfume, iron and much else is smuggled across easily and frequently. Although official statistics are not available, a study conducted by the Federation of Nepal Chamber of Commerce and Industries estimates that illicit commerce along the southern border alone totals nearly 40 percent of the country's foreign trade.

At times, the fluidity also raises issues of national security: Nepal's borderland is rumored to provide sanctuary to Pakistani militant groups such as Lakshar-e-Taiba, allowing them to conduct operations in India before slipping back across the border unscathed. In addition, the open border has allowed for the easy movement of weapons. Years of Naxalite guerrilla fighting in Bihar have made the area a hub of the region's weapons trade. In recent years, arms have become widely available in Nepal's southern plains, also known as the Tarai.

In the past, the Indian and Nepali governments have trumpeted the need to gain control of the borderland. Yet, conditions around the border have remained much the same. Over the years a pattern has begun to emerge: a smuggling scandal erupts in a local newspaper, a high-ranking politician denounces the 'anti-social' and 'anti-state' crimes facilitated by the open border, promises of crackdowns are made and sometimes successfully executed, but after a few months the dust settles and things move along as they did before.

In Regionalism and National Unity in Nepal, Frederick Gaige describes the Indo-Nepal borderland as a place that "retains much of its character as an open frontier, with rapid in-migration, clearing of land, and settlement, along with the presence of rice barons, outlaws with local reputations, and vigilante law". Birgunj is one of the largest cities in the borderland, and today can hardly qualify as a mere frontier outpost. However, the city does retain a certain wildcat, lawless quality. Rumors of kidnappings, criminal characters and showdowns in abandoned warehouses often spice up conversations over tea. On occasion, people carrying pictures of missing family members walk around the shops and restaurants in search of news.

An old profession
The notable resilience of illicit trade and activity in the borderland is due in part to the particular nature of the region and the manner in which it was settled. In an otherwise mountainous country, the Tarai stands out as a narrow strip of fertile plains approximately 800 km long that abuts the Himalayan foothills. For centuries, much of the Tarai was covered in dense malarial forests and was one of the least developed regions in Nepal. The Nepali-speaking Shah monarchs, ruling from the Kathmandu Valley after the 1769 conquest and unification of the country, viewed these forests as an advantageous shield against Indian and British invasions, and so did not encourage settlement in the area.

This, however, did not stop enterprising individuals from taking advantage of the ease of trans-border travel. Initially, much of the smuggling in the Tarai involved opium, which grew well in the area. Opium was a prized commodity in India from before the Mughal conquest, and the profits associated with its trade only rose as there began to be increased demand from Chinese and European markets in the 18th and 19th centuries. The early Shah kings, in an effort to control the smuggling and bolster customs revenue, reportedly planted thorny bushes on many of the trade routes, hoping that they would become overgrown and forgotten. Inevitably, such weak efforts at control failed. With the lack of customs posts and border patrols on both sides of the border, risks remained low while profit remained high, and smuggling continued to flourish. Kathmandu's hold over the area remained weak and trade looked primarily to the south, and Tarai cultures, languages and economies consequently oriented themselves more towards the Indian plains than the Nepali hills.

Gradually, as the British authorities found it increasingly necessary to maintain proper judicial and administrative control over their Indian territory, they felt a particular need for a more formal border. The Sugauli Treaty, which was ratified in March 1816 and ended the Anglo-Nepali War, first formalised the boundary between Nepal and British India. Despite this development, Tarai society remained markedly positioned towards India. Government presence and authority in the region remained weak, and communities on both sides of the border actively made use of the border's porousness.

After Nepali cooperation in suppressing the Indian 'Mutiny' of 1857, Anglo-Nepali relations improved and there no longer seemed as strong a need to maintain a barrier between the two territories. Nepal's erstwhile rulers, the dynastic Rana ministers, began encouraging settlement by offering 'free man' status to any Nepali slave who colonised the Tarai. Oral histories from this time tell of exhilarating journeys through the wilderness to seek opportunities and new life. In general, however, the inhabitants of Nepal's mountainous regions found the Tarai hot, flat, malarious and unpleasant; consequently, the Nepali government had to rely upon adventurous and pioneering Indian settlers pulled northward by India's rapidly developing railways. Settlement from the south further encouraged regular movement between Nepal's borderland and northern India, and the boundary between India and the Tarai remained fuzzy. Smuggling continued to be the most common economic activity, and allowed for a degree of wealth in the newly-settled region as locals exploited cross-border price differences for a greater variety of commodities. Smuggling also became more systematic as individuals increasingly worked in concert for the sake of profit. Cultivators worked with village headmen and government administrators, and opportunists from Punjab and Assam ventured into the Tarai to facilitate contact with Indian agents at Calcutta.

In the mid-twentieth century, the Tarai saw major political and economic developments that had beneficial impacts on both the licit and illicit economies. Following Indian Independence, the 1950 Indo-Nepal Treaty of Peace and Friendship officially created an open border. This was quickly followed in 1953 by the construction, with Indian government aid, of the Tribhuvan Highway that connected Kathmandu with Birgunj. Soon, factories producing matches, cigarettes, rice, sugar, vegetable oil and jute began to crop up as new Nepali companies took advantage of the improved access to Indian raw materials and consumers. As more forests were cleared, the Tarai's fertile, water-rich plains also became ideal for agriculture, especially when compared to the rest of Nepal. The borderland soon became a base for both agriculture and manufacturing. By 1965, the Tarai's contributions represented approximately 55 percent of the country's agricultural product, and the region was home to about 72 percent of Nepal's industrial production.

For as much legitimate business activity that occurred in the Tarai around this time, there was just as much, if not more, illicit trade that continued to pump money into the borderland. Goods that could be acquired cheaply in one country were smuggled into the other and sold at higher prices, and the specific list of smuggled commodities continued to change in response to local and global demands. For example, when the Soviet Union and China began to send development aid to Nepal in the early 1950s, donated goods such as cement, sugar, bicycles and fountain pens that were shipped to Kathmandu via India were then promptly smuggled back into the Indian market, where these items had a particular demand. For several decades, there was also significant smuggling of agricultural produce, mostly rice and wheat, as the fertile Tarai enjoyed food surpluses while northern India often suffered shortages.

A tonga on its way to the Indo-Nepal border.<br />flickr / junn-sato
A tonga on its way to the Indo-Nepal border.
flickr / junn-sato

The cast
Not long after I arrived in Birgunj in the spring of 2010, I went back and visited the border archway that my companion and I had so casually breezed past in our pursuit of early morning tea. It was mid-morning, and already the area was filled with people, carts, cows, motorcycles and trucks passing in both directions, in and out of Nepal. Trucks that had goods to declare were lined up on the side of the road, awaiting their turn to clear customs. Many of the drivers were milling around, chatting with each other and drinking tea.

Two of them, a young man in his early twenties and an older man with a protruding paunch, asked me to join them for a lunch of fried fish that they had just finished cooking in their truck. Glad to get out of the heat and dust, I accepted and heaved myself up into their vehicle. My hosts were from Rajastan, and transported readymade clothing from northern India to Kathmandu once a month. When I asked if there was a lot of smuggling along the border, the younger man chortled into the pile of fish bones he had gathered on his plate. The older man glanced at him and then at me, and seemed unimpressed by my question. "Yes, of course there is a lot of smuggling," he said. "It's too easy not to take advantage of – almost everyone does it. Most of us just under-declare when we pass through customs. It's an easy way to make a bit of profit." I finished up my fish and rice, thanked them for the food, and excused myself. They cleared the plates away, took out a deck of cards, and began to play.

After my lunch I headed to the Birgunj customs office. The office is a chaotic, dirty building not far from the archway. The Nepali government was in the process of building a new, streamlined, high-tech system for processing the large amount of traffic that passes through this checkpoint each day, but the project had not been completed. I sat down under the shade of a tree outside the office and watched the mass of people passing by on the road. I was soon joined by a member of the Armed Police Force unit in charge of monitoring the border, who was on break. Another police officer, a customs official and a number of passersby lingered, intrigued by my presence.

Despite our audience, the police officer spoke to me candidly in Nepali. Each day, he estimated, eight hundred smugglers cross the border at Birgunj carrying any variety of things, and about one hundred of them are pulled aside for questioning. The onlookers, now rapt, murmured at these words. The officer went on: Bribery was common practice, and the amount paid was related to the value of the smuggled goods, ranging from NPR 500 to 10,000 (USD 5.6 to 112) or more. "A lot of the bribes come from the smaller or lesser known businessmen," he said, "because they aren't as likely to know some politicians." Higher-level politicians, officials and other thulo manche, or 'big men', handle bribes with larger businessmen. "We have to be careful. If we ask a businessman who has already paid off a politician for a bribe, then he might go tell that politician and maybe I will lose my job." And no one at the border wants to lose their position; a posting here means hitting one of Nepal's bribery jackpots.

I learned that smuggling activities in Birgunj fall along a spectrum. On one side of the spectrum is small-scale, localised smuggling, in which businessmen utilise local women, children and disabled individuals to ferry goods like sugar or clothes across the border. Prevalent social norms make these people generally less suspicious, and therefore less susceptible to the attention of officials. Such smuggling also provides a small livelihood for locals who may have difficulties earning wages otherwise. Goods are often carried in a pogha, a large sack that locals commonly carry on their heads to transport everyday materials. Depending on the goods and the quantity smuggled, carriers commonly make between NPR 50 and 200 (USD 0.56 and 2.2), or roughly ten percent of the shipment's worth. Drugs are also smuggled in this way, and carriers make as much as NPR 5000 (USD 56) per shipment. This system usually works well since the Nepali authorities simply do not have the resources to adequately search the number of people crossing the border every day, both on foot and by tonga, many of whom are women carrying poghas.

Businessmen dealing in riskier or more valuable items – tractors, iron, cars, car parts and other goods that incur substantial import duties – prefer smuggling when the border is closed, from 10pm to 5am every night, to circumvent the risk of customs inspection altogether. Some goods are transported on buses and ambulances that continue to cross even during night hours, and so areas around hospitals and bus parks are key locations for exchanging money and smuggled goods. Some smugglers choose to use less formal routes, preferring a series of back-roads connecting villages along the border. On occasion, large trucks with smuggled goods work their way through villages at night, although bicycles and tractors are also often used so as to attract less attention.

That same afternoon, after talking with the police official at the customs office, I crossed the dusty road to the police compound. In addition to the area's police headquarters located slightly north of the city centre, a smaller complex was located at the border specifically to monitor the crossings. The compound was well-secured, with large white walls covered in barbed wire. As I walked in, there was some ruckus that was disrupting the surrounding traffic. An elderly woman was quarreling loudly with two police officials who were accusing her of smuggling. The woman was driving a small horse-drawn cart, weighed down with sacks ostensibly filled with rice and lentils. The officials were in the process of corralling the woman and her cart into the police compound. As the gate compound closed behind us, the roar of the street died away, but the woman's shouting and protests continued. The official I had come to meet greeted me and led me away from the scene.

The official and I spoke in his office at the back of the compound. It was quiet, save for a whirring fan that failed to dissipate any of the sticky afternoon heat. He offered me part of his lunch of rotis and cauliflower, but evaded my questions on the relationship between local officials and businessmen involved in smuggling. Instead, he told me about the various village back-roads that smugglers used to avoid detection. After the interview ended, I walked back outside to find that the elderly woman, her horse, and her cart were gone. I asked what had happened. An official upturned his palm and quickly rubbed his thumb and his fingers together, as if ridding them of crumbs. The motion was a gesture for a bribe. He said, "We let her go."

'Line clear'
More than a year later, during the summer of 2011, I met Prakash, one of the leading businessmen in a smuggling scheme operating out of Birgunj. Securing a meeting with him had been difficult because the district was witnessing a series of police crackdowns on lawless behaviour, and everyone was on edge. A mutual friend had vouched for me, and Prakash had finally agreed to talk with me in my hotel room, where he could be sure that the meeting would be private. He was late, but eventually he rushed into my hotel room swinging his motorcycle helmet and clutching his smartphone, apologising profusely for his tardiness.

Prakash, a slight man with smiling eyes and an infectious smile, was dressed smartly in grey slacks and a dark purple shirt that smelled vaguely of paan. He took a seat and smiled shyly. He told me he was originally from a village outside of Birgunj, and had worked there as a pharmaceutical representative until he decided to move to Birgunj and become involved in smuggling. The allure of big profits was strong; as a smuggler, he could expect to earn five to ten times more than he did in his village job. Prakash had been a smuggler for more than ten years, directing a group of about ten businessmen who illegally moved goods – mainly fertiliser, rice and wheat – from India to cities throughout Nepal. According to him, there were approximately ten such organised smuggling groups working independently in the area at the time. His group, as well as the others, had halted their operations for the duration of the crackdown, and Prakash was anxious for it to end. "These crackdowns are good for the nation because they will build a good reputation for the government," he said, "but for my own sake, I hope they stop." He told me he was working with some of the area's other businessmen to see what could be done to hasten the end of the crackdown.

A few days later, also in my hotel room, I met Binod, the leader of another of Birgunj's organised smuggling groups. Like Prakash, he had a humble warmth that did not immediately suggest that he was one of the area's more powerful smugglers. Binod was raised in a nearby village as one of eighteen children. For almost 20 years, he had run a small clothing business in Birgunj. However, running a "white" business was hard, he said, and it was difficult for him to compete against other businessmen, many of whom engaged in some way with the black market. When his business fell into crisis, Binod was persuaded to switch to more profitable, "black" means. "I decided I wanted fame and wealth. If I had money, I could also help the people back home," he told me. After switching to black business, Binod said, he became one of the richest men in his village, where he claimed he was using a fair portion of his money to help the poorer families.

Both Prakash and Binod explained to me a well-developed system of moving contraband, in which each group has ten to twelve individuals stationed in villages and cities along the smuggling route from India to Nepal. The goods are initially sent to a godown, or warehouse, in India. The businessmen stationed in each village or city on the Indian side arranged to transport the goods to the next village or city along the route. Prakash and Binod were each respectively in charge of their group's operations in Birgunj, one of the most vital cities along the route since the entire chain depended on the smooth transportation of goods across the border. Once in Nepal, the goods were sent to a godown on the outskirts of Birgunj, from where they were transported to other Nepali cities.

Prakash and Binod each maintained relations with at least 15 political leaders in order to ensure protection. Binod said his group paid up to NPR 50,000 (USD 562) every month to local politicians, who then decided how much to pass on to their superiors in Kathmandu. Due to the significant potential for profit, Binod also said, politicians usually took the initiative to approach him or one of his colleagues and would ask to become involved in the group's activities. Once protection from local politicians was secured, Prakash and Binod operated a system known as "line". "Line clear" meant that all checkpoints and customs offices along a given route were managed by officials who had been bribed to ensure protection. "No line" meant a break somewhere along the chain, where protection was not guaranteed. No trade or transport occurred during "no line time", but operations restarted immediately once the problem had been resolved and the line cleared.

Hand in hand
That officials and smugglers work closely with each other in the Tarai is fairly well-known. One study, conducted along the India-Nepal border from August to November 2008, found that not a single person was apprehended for smuggling during that period. It is hard to believe that this was because there was no smuggling happening along the border; rather, it seems a sign of complicity between smugglers and officials. Occasionally, evidence arises of political involvement in smuggling. In 2010, six people, including the chairman of a district-based community forest in the Tarai, were detained for smuggling illegally felled timber. In response, district leaders of the Communist Party of Nepal-Maoist came to their rescue and proclaimed their innocence. The individuals in question were left unprosecuted. Not long after, three people were arrested for felling over 50 trees in the same community forest. As expected, Maoist leaders again successfully exerted pressure on the district forest officers for their release.

This intimate relationship between the official and unofficial realms has interesting implications on state power in places like the Indo-Nepal borderland. Willem van Schendel, a scholar at the University of Amsterdam, has worked on border areas in Bengal and Bangladesh. He suggests that officials and smugglers rely on each other for legitimacy and survival, however, the smugglers normally have the advantage. Smugglers remain nimble and adaptive to changing conditions, and retain the ability to abandon official rules – to ignore, contest, tease and subvert state power. If they so choose – and they often do – smugglers and other illicit actors can avoid interacting with officials altogether. This is especially so on the Indo-Nepal border, which is so open that checkpoints are easily circumvented and interacting with border official is most often a choice, not an unavoidable fact. Schendel contends that, try as it might, the state is never able to bring the smuggling economy fully under its control. At best, it can engage with the smugglers on their terms: Officials can only profit from the system by demanding bribes, and to do so they must initiate contact, seek the trader out. As a result, state officials are ceaselessly chasing their shadowy counterparts.

And yet, while smugglers have the ability to subvert state power in the borderland, they rarely choose to do so. In their work on international border societies, anthropologists Thomas M Wilson and Hastings Donnan find that smugglers tend not to be revolutionary since they are dependent on the state and the policies that they are perpetually seeking to outfox. In this sense, smugglers must be understood as multifaceted and even contradictory actors, at once subversive and conservative. Consequently, according to van Schendel, while minor conflict can be expected at the margins of a smuggling system, the structure of power endures as both sets of actors, official and criminal, consciously or unconsciously legitimise and uphold the other. Smugglers acknowledge state-defined borders by seeking to cross them illegally, while officials uphold smugglers' power by attempting to engage with them.

When I visited the town of Kodari on the Nepal-China border, a policeman who had recently been transferred from a post along the Indian border alluded to these nuanced dynamics between Nepal's smugglers and the Nepali state. "Honestly speaking, we know how the smuggling system works," he told me. "We know the tricks and the transportation methods that smugglers use. But we officials do not truly have the power to stop these people who smuggle. If we stopped them here, there would be rebellion and unrest here in Kodari since many people depend on this system for their livelihood. What would happen if we cut this system off? For our own safety and for the survival of the town, we let the smugglers pass."

Periodically of course, due to external pressures, the police intervene, as they did in Birgunj in the summer of 2011. Those connected with the illicit economy seethed. Indian truckers protesting the crackdown parked their vehicles across the road on the Indian side of the border, stopping all but foot traffic headed into Nepal. When police took the city's president, Mohammad Sahabuddin, into custody for corruption, the district president of the Nepali Congress Party, along with other political cadres, staged a sit-in outside the Birgunj police headquarters urging the authorities to heed 'political recommendations' for Sahabuddin's release. Unlike in times gone by, however, the police did not bend to political pressure and Sahabuddin remained in custody. The crackdown was unusually tough: for nearly a year, rules were strictly enforced and smuggling decreased significantly. But the smugglers proved resilient, and when the crackdown eventually ended things returned to the way they had been. Today, the smuggling in the borderland is as strong as it ever was.

Like anywhere else, the nature of Nepal's borders is a sensitive issue in the country's domestic politics. Nepalis who worry about the Indo-Nepal border's current status mention possible Indian encroachment and the fact that Nepal loses an estimated NPR 3 billion (USD 33.7 million) in royalties each year due to smuggling. However, as in the past, adequately monitoring the border remains a happy ideal at best. Nepal's borderland is currently the most populous region in the country, with an estimated 15 million inhabitants, many of whom frequent India and remain intimately linked to the cultures and economies of Bihar and Uttar Pradesh. Even disregarding the sheer cost of effectively managing this frontier, given the chronic instability of the Nepali government, the system would still be rife with the potential for corruption. Interestingly, besides a few wealthy elite individuals who control illicit empires, the business of smuggling seems to appeal mostly to the lower class. Many of the borderland's middle class families prefer to leave Birgunj for Kathmandu in search of better opportunities and education. Still, Birgunj's middle class slowly continues to grow, much as in other urban centers in Nepal, and this could drive a shift away from illicit trade in the border economy. For now though, the smuggling economy remains alive and well, just as it has for centuries.

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