Up-country bazaar and changing forces
The Himalayan hinterland, for all its isolation, has never been far from the economic forces at play in the rest of the subcontinent and the world. Change in bazaar towns was not always for the better.
Common interpretations frame change in terms of the same obvious political events which are accepted as cumulatively making up Nepal´s history. Starting with unification in the 18th century, these events include the ministerial takeovers by the Thapa and Rana families in the 19th, and, in the 20th, the revolution of 1950-51 which brought the fall of, the Rana regime, and the people´s movement of 199O which ended the Panchayat system.
This reduction of history into a document of the careers of regimes allows the complicated lives of the people of Nepal´s villages to fall away from the picture. Their lives are trivialised and formalised in theories that misrepresent them as overly traditional, stagnant and fatalist. Rather than the force and purpose of change, the villagers´ fecundity and conservatism are seen as its roadblock, which must be subjected to the dynamism of "development."
The truth of the matter is that rural Nepal has always dynamically interacted with and shaped the flow of historical events. The Nepali countryside of today was shaped by a long, gradual process of the entry of village society into wider spheres of interaction. It is the villager who produced and traded the products of the land, who filled the coffers of kings and fattened the moneylenders, who built the palaces and fought the wars and who bore, nursed and fed all, from pauper to king.
More significant as markers of change than the rise and fall of regimes is the development of relations among the various peoples which underlay them. Industrialisation, marked by the invention of the Spinning Jenny in 1764, merely confronted an existing dynamic which had been developing over many centuries, or even thousands of years, to sublimate and set it to its own purposes. Key steps in the process, for the transformation of industrial and commercial life in Nepal, were the global rise of the conglomerate joint stock corporations, in the latter part of the 19th century, and their succeeding expansion into the multinational corporation in the 1940s. These changes were accompanied in the Indian subcontinent by the appearance of indigenous industrialists, in the second half of the 19th Century, and their assertion of control over the economy and polity from the 1920s onwards.
The sudden, successful pioselytisation in Nepal of "development", the ideology of capitalism in its multinational form, has been the culmination of a long series of developments in the villages of Nepal. While colonialist adventurers of the late 19th century created a picture of a "forbidden kingdom", still profitable for marketing exotica, the hills of Nepal were being buffeted by economic and technological changes with origins far from the Himalayan heartland—in the industrial cities of Europe and commercial centres of India. How did these changes penetrate Nepal´s remote valleys?
Perhaps the most important agents of change opening the hinterland for expansion and exploitation by outsiders were the Newar mercantile families who managed the rural commerce across Nepal from their trade marts such as Dhankuta, Chainpur, Doti, Tansen, Bhojpur, Kusma, Baglung, Pokhara and Dailekh. Scattered through the length of the middle hills of Nepal, these towns were settled mostly by families from Bhaktapur and Pat an in the wake of the Gorkha conquests. Although these rural bazaars quietly and slowly grew amidst the swirl of political events, they have been major actors in shaping the countryside of today.
The Bandipur Tradition
An old family genealogy, written on bark paper in the 18lh century, records that, in 1769, a scion of a wealthy Bhaktapur family, Tekan Singh Piya, left his home following the overthrow of the Mallas. He travelled westward and settled in Bandipur, a trade mart on a ridge of the Mahabharat range above the Marsyangdi river. Bandipur, according to the letters of Prithvi Narayan Shah, had already been taken by Gorkha from the Tanahun king in the February of that year.
Following the complete conquest of the Kingdom of Tanahun, Bandipur became the military capital of the new district. Rana Bahadur Shah, Prithvi Narayan´s grandson, awarded Jagadev Bhandari, of a prominent Lamjung family, with the post of sardar of Tanahun in 1792, providing him a large birta estate near Bandipur as reward for his role in the war of conquest.
Old tamsuk, or debt vouchers, indicate that by the 1790s, Tekan Singh´s family was trading in homespun cloth, ghee", and other goods produced by the surrounding Magar and Gurung villages. Business records and personal correspondence from the 1830s indicate that Tekan Singh´s descendents also continued to maintain property interests in Bhaktapur, where they collected rents and engaged in usury.
Taking advantage of the peasant hunger for credit — arising from the centuries-old inequalities in landholding and distribution of agricultural products which had culminated in and underwrote the Nepal i State—the merchants loaned a portion of their proof its to peasants in the surrounding countryside. The peasants mortgaged their accumulated wealth in jewellery, farm implements, animals, land, and even rights over the bodies and labour of their children. Formidably high rates of interest enabled the merchants to slowly alienate this peasant wealth and labour and increasingly assert more direct control over agricultural production, displacing older claims on the peasant labour. The surpluses alienated in this fashion were reinvested in trade. Strategically situated between the Indian plains and the Himalayan highlands, the Bandipur merchants also established themselves as middlemen in the flow of trade from India to the hills and mountains of Lamjung, Manang and Mustang. Thus, when machine-made textiles began to enter the subcontinent following the mechanisation of cloth production in Britain during the last one-third of the 18th Century, these bazaar merchants were already positioned to promote the penetration of foreign fabrics into the Nepali countryside and the great changes in Indian cities such as Kanpur in Die latter part of the 18th Century pushed down prices and encouraged further expansion of textile markets.
Previously, traders had been mostly immersed in local commerce, economically exploiting village producers and buyers, but also providing the credit that underwrote and sustained agricultural production and community life. As the bazaar merchants traded increasing quantities of industrial commodities, however, their relationship to the countryside slowly changed. With the new liade, the bazaar merchants of Bandipur became incorporated into the circulation of industrial commodities, in which the sales of fabrics to villagers became the last step in realising the price of the product necessary for sustaining and expanding factory production in India, Britain, the United States and, eventually, Japan. The merchants´ orientation and commitment gradually shifted away from the community of the villages around Bandipur, with its moral imperatives and obligations, to the goal of expansion of markets for foreign industries.
The market underwent a qualitative change following the First World War, nine generations after Tekan Singh´s arrival in Bandipur. Large numbers of Magar and Gurung veteran mercenaries returned from the War with their accumulated wages and new desires. At the same time, the up-country bazaar capitalists in India began forcing their way into the prev iou sly Europe an -controlled foreign trade, displacing the large European houses such as the Ralli Brothers of London. Volk art Brothers of Switzerland and David Sasson & Company of Manchester, which could not survive the market crises of the period.
As they grew and consolidated their position, the native Indian mill owners were beginning to shift their support from the British colonial government to the Indian Congress Party. Foremost among these were the Birla and lspahani families, closely connected with Gandhi and Jinnah, respectively. This process culminated, following the Great Depression and the Second World War, in Indian native capital´s final assertion over the colonial state apparatus, represented by the Indian Congress Party and Muslim League in India and Pakistan.
Although the Rana regime, along with the remaining Indian princes, was one of the casualties of this process that gave "independence" from the British to India, the impact was not limited to Kathmandu´s rulers. As large Nepali merchant houses were "themselves already integrated within the up-country bazaar economy of North India, this process greatly benefitted their position.
Expansion
The merchants of Bandipur were set to take full advantage of political and economic changes represented in the shift of the administration of colonial stales from foreign to native rulers. By the 1930s, the bazaar population totalled more than 10,000 people. Tekan Singh´s descendents alone counted for more than 4,000 of them.
The eight largest merchant houses, each with large co-resident extended families and dependent retainers, expanded their operations into subsidiary bazaars across the southern slope of the Himalaya and along the Mahabharat east from Trisuli to Pokhara and south to Chitawan. These smaller bazaars with Bandipur´s presence included Phale Sangu, Besisahar, Khudi, Tarkughat, Jarebar, Tunje, Changling, Maibal, Rising, Kabung, Sabung, Khoplang, Phalangkot, Thulo Dunga, Kunchha, Chisenku, Gorkha, Trisuli, Pokhara, Narayanghat,Butwal, the yearly haat bazaar at Devghat, as well as Bhikna Thori on the India border, where Bandipur merchants also had winter shops and large go downs.
While remaining under She ownership of the patriarchs of the trade groupings, in a manner characteristic of north Indian business houses, these subsidiary shops were managed by sons and poorer, dependents -in-law. Other brothers and sons apportioned their lime between Kathmandu, Butwal, Bhikna Thori and India, arranging licences and quota rights, raising
finance and transferring moucy, buying and facilitating the movement not only of cloth, but of raw cotton, thread, cigarettes, kerosene, salt, bangles, shoes and other profitable goods.
The trading house headed by one of Tekan Singh´s descendents was the largest and wealthiest in Bandipur. According to oral histories, by the 1930s, die eight major merchant houses were engaged in a total yearly purchase of approximately 1.5 million rupees of fabric and other goods from India, wholesaling to the other smaller Bandipur merchants and to traders walking down from Manang and Mustang, and retailing to the agricultural producers in far-flung villages. Members of each household made five or so trips to India every year. In these trips, 70 to a 100 merchants look along hundreds of porters and carried immense quantities of coinage.
They went armed, as protection against thieves in the forests of Chitawan, where they often buried and slept upon the money at night. Avoiding colonial inspection points, the merchants surreptitiously exchanged their Nepali coins with Indian businessmen in Narkatiaganj or with returning Lahuray mercenaries in Butwal, depending upon the rates — a constant topic of their letters.
In India, many of the merchant houses had established residences and warehouses, and close social relations (often as mil or blood brothers) with large Indian commission agents who provided them with purchasing, credit, money transfer, exchange, transport, insurance and other facilities. They also utilised close relations with important figures in the Ran a government to gain control of customs, licensing, marketing quotas, as well as obtaining various government contracts within Nepal. Some of thier own family members, positioned as judges, customs inspectors, talukdars and other officials, greatly facilitated access to the Rana government. During a period when a son of one of the families of Bandipur bazaar look the contract for the customs post at Bhikna Thori, the Bandipur merchants avoided paying customs duties entirely, causing Kathmandu businessmen to walk the two weeks roundtrip journey to Bandipur to buy wholesale fabrics at cheaper prices.
Erosion of Rural Life
The Bandipur merchants´ expansion of outlets directly into the countryside meant that they were able to exeri further control over agricultural productionin villages throughout Nepal´s region between Trisuli and Pokhara. It was in this period in the late 1920s and 30s, with a decrease in the prices of imported textiles and a transition by Indian mill owners to the production of inexpensive fabrics, that the indigenous fabric production in the villages of the central hills received its death blow.
The fields of cotton in the valleys and the looms in the households all but disappeared. Peasant agricultural production and the round of village life were by now deeply drawn into the sphere of commodity exchange, and elements of village relations and culture had taken new content and meaning, or had been transformed entirely. As spinning and weaving had been the domain of women and this same household labour had to be somehow entered into the market within relations controlled by men to obtain the same commodities, this change particularly affected women´s status and autonomy in the households and community.
As he lay dying of fever in 1775, Prithvi Narayan had warned of the threat posed by imported textiles. In the years 1939-44, Rana Prime Minister Juddha Shumshere vainly attempted to reindustrialise Nepal by establishing the Cottage Industry Department {"Gharelit"). Although initiated to encourage indigenous village producers, the. Gharelu was co-opted by [he merchants, whose accumulated capital, control of the villages, and connections to officials gave them an edge over village producers.
A group of major Bandipur merchants, facilitated by a well-placed family member, took advantage of government subsidies to establish the Saraswati Cloth Factory, which fell apart as soon as the subsidised thread became unavailable. Individual merchant houses used a quota system, meant to encourage the producer by allotting distribution of cloth in each district, to establish a monopoly over materials and finished textiles, allowing sale to villagers at exploitative prices.
Soon after, the Indian Congress Party, itself linked to the large Indian business houses, took over the state apparatus in India, it forced the Rana government to discontinue the quota sys tern. The Bandipur merchants who, according to their letters, had already been anxiously anticipating this step, dismantled the Gharelu and shifted the capital accumulated under it back into commerce on a scale far larger than before.
As the rural community had been based on the unity of agriculture with household industry, the destruction of the domestic industry in the 1920s led directly to erosion of rural society and culture, and its "formal subsumption" to industrial production. Wider and wider spheres of the rural production were subsumed in the circulation of industrial commodities by the merchants. In part, all this meant the growing subordination, expropriation and displacement of the old class of landlords, as represented by Jagadev Bhandari´s descendents, who lost their original birta estate piece by piece over the several generations, by foreclosure to various large merchants; many of these, however, moved into new roles in administration.
Shifting Center of Gravity
Until the 1950s, the Bandipur merchant houses were satisfied in simply establishing themselves as rental landlords over existing small hold agriculture through various sharecropping arrangements. But with the development of transport and greater accessibility to markets, the merchants and other landlords have been entering their capital in to cash crop production and industry using wage labour.
It was in 1952 that the gradual shift of Bandipur residents into the Chitawan valley to the south started. In Chitawan, facilitated by a USATD malarial suppression and "defoliation" campaign which inundated the area with DDT and constructed the then largest sawmill in Asia, the Bandipur merchants, especially those from the target houses, used their stocks of capital, alcohol and Tharu hospitality to expropriate the Tharu villagers from their communally he Id lands, reduce them from hosts into house servants, and illegally clear great swathes of forest for grain, mustard, and vegetable production for sale to urban markets in Nepal and India.
The emigration from Bandipur to Narayanghat, but also subsequently to roadside markets of the inner valleys, increased as roads were constructed linking the region to India, the new agricultural markets of the Chitawan and outer Tarai, and the urban centres of Kathmandu and Pokhara. This process has repeated itself in Tansen, Dhankuta and other hill bazaars.
In Bandipur´s case, individuals of one "new-rich" family spirited the offices of the district headquarters to Damauli (on the newly constructed Kathmandu- Pokhara Highway) in a night-time coup d´etre. The town of Bandipur, which meant so much to so many generations, remains today little more than a crumbling, though elegant, monument to its economic heyday. It had risen upon and sapped away its own rural hinterland, to itself disappear as roads that followed river valleys took away the raison d´etre of hilltop bazaars.
Recent Events
In the 1980s, the transformation to cash crop production extended from the Chitawan lowlands back towards Bandipur and other hill areas to the north. The remaining small merchants and others who could mobilise the necessary resources began citrus plantation and nut orchards. Where the hill farmers had already long served as s hare croppers on the paddy lands, these cash crop plantings, growing exponentially since the beginning of the 1980s, have increasingly displaced these people, through foreclosure on long accumulated debts, from the dry lands which had been the remaining property base of the communities.
The rural labourers have had no choice but to enter directly into national, regional and international labour markets in order to satisfy needs and wants which they had previously supplied themselves (clothing, foodstuffs, energy, transport, entertainment) and to offset their decreasing access to products.
As the members of the bazaar class extended their activity and control into more and more sectors of national life, in their role as agents of regional and international forces, they and associated groups, like their Indian counterparts under the British Raj, began to bid for more direct control of the State political machinery than possible through Hiechakari and other personalized means of making demands on power.
Thus, in the closing days of the overstated "revolution" of 1950-51, it was the people of Bandipur bazaar, feeling that their widening spheres of activity and interests were increasingly restrained, who launched an attack on the local army garrison (albeit when shot upon they fled, leaving eight dead). They were not the villagers who had lost their land and become dependent upon the bazaar merchants for commodities and finance, nor were they economic migrants.
The subsequent royal takeover and essentially one-party rule from 1962 lo 1989 were tolerated by the merchants and the international forces that they represented, because a variety of unpredictable interests continued to contest their control of Nepali Stale and society. Foreign governments and agencies underwrote the one-party State´s advancement of the penetration and co-opting of the remaining local autonomy and control over resources and labour in the name of development, modernisation, rationalisation and other euphemisms (crowned most recently by the new local government law). This process was augmented by universal education and a certification system that set (and continues lo set) formalistic, esoteric and inappropriate forms of knowledge of the Western-oriented specialist over megeneralise practical knowledge of the villager.
By 1989, many of the sons of the Bandipur merchants had become national players in business, the profess ions and political leadership. Their power and breadth, along with that of their domestic counterparts and the international interests they associated with, had sufficiently neutralised the remaining indigenous social organisation and culture in the countryside, albeit with disastrous effect on the environment and rural community, leading the one-party government to itself become an obstacle for the full assertion of these groups.
Thus, the burgeoning new force represented by the bazaar merchants, nationally and internationally, gave its qualified support to a political upheaval ignited by the images of freedom and democracy. Labelled with the euphemistic term "People´s Movement", it was safely halted once the representatives of the emergent dominant groups had set the terms to renegotiate their access to the State machinery without actually threatening it.
The drafting of the new Constitution and laws, such as of local government, which was one of the more visible aspects of this process of renegotiating the relationship between various interests within society, has removed many aspects of the process of industrial expansion and transformation from the domain of State control and political contest to the private one of business relations in the name of "privatisation". It has circumscribed the sphere of public decision and dialogue in the name of "democracy" and removed control over the country´s resources and labour from the village producers in the name of "free markets" and "autonomy" of local governments that lack any effective mechanisms of accountability to their constituencies.
Thus, the cure proposed for the changes exemplified by the 200 -year history of hill towns in Nepal such as Bandipur bazaar is an even bigger dose of the old medicine, reflecting the worldwide consolidation of corporate industrial interests which increasingly provided the substance of this history.
Mikesell currently researches at the Centre for Nepal and Asian Studies, Tribhuvan University.