Nepal's New Customs Rule Sparks Border Community Uproar

The government's recently implemented provision of imposing customs duty on goods exceeding one hundred rupees has caused a significant stir in the lives of border communities, without meticulously detailing the sensitivity of Nepal-India's open border and the socio-economic conditions there.

Although at first glance this appears to be a legal effort to increase revenue and bring the economy into the tax net, its repercussions are seen to extend beyond just revenue generation, impacting the fabric of border society, the daily lives of the poor, and the historical relationship between Nepal and India.

Viewed in this light, we have previously experienced how such rules, brought in without adequate study and consultation with stakeholders, become weak as they do not align with reality. This is because for any policy to be successful, the arrangement outlined within it is not enough; rather, the impact it has on the community is significant and that is what becomes decisive.

A vivid example of provisions that are ultimately proven futile because they are not accepted by the general public is the 'Social Reform Act, 2033 BS'. Although this act, with good intentions, aimed to reduce the number of guests at weddings and curb extravagant spending, it gradually became ineffective as it did not align with the social consciousness and behavior of the time.

While passengers arriving by air receive legal exemptions on expensive mobiles, liquor, or gold, the provision that requires the poor arriving by land to pay customs duty even on two kilos of sugar raises a serious question of whether the state belongs only to the wealthy.

In the current one hundred rupee provision, the lack of adequate discussion with stakeholders and impact analysis is felt. This unilaterally implemented decision appears to have, in some way, neglected the ground reality of the border and the livelihood of the citizens.

In reality, it is natural for dissatisfaction to arise among citizens when the state tries to impose decisions without understanding the grassroots sentiment. This is because the people form the government, not the government forming the people. Here, we will discuss some of those aspects that the government has failed to grasp.

• The argument of revenue and 'grey economy' control

In the current situation where the state's treasury is weakening, the effort to increase revenue is theoretically correct. However, we can agree with the government's understanding that financial capacity cannot be strengthened until the informal economy, estimated at around 37 percent by the International Monetary Fund and the World Bank, is brought into the mainstream.

However, the government's focus on searching the bags of ordinary people, instead of adopting modern high-tech surveillance systems to prevent billions in revenue leakage, reflects a contradiction in the government's priorities and policy indecision.

This is not just an imbalance in priorities but also a serious policy discrimination. While passengers arriving by air receive legal exemptions on expensive mobiles, liquor, or gold, the provision that requires the poor arriving by land to pay customs duty even on two kilos of sugar raises a serious question of whether the state belongs only to the wealthy.

Forcing a decades-old provision from around the decade of 2042 BS onto the present time, ignoring practicality and technology, not only shows how impractical this policy is but also clearly demonstrates how far the state is from the grassroots problem.

Collecting taxes on ordinary gifts brought back from a visit to one's maternal home or goods brought by returning migrant workers, treating them the same as commercial goods and subjecting them to humiliation by security personnel, is sowing the seeds of serious social discontent.

In reality, instead of the state spending its resources to identify the root of large-scale smuggling, organized contraband, and illegal trafficking, and to structurally improve the customs administration's procedures and working style, it has caused hardship to small consumers at the border and forced them to seek alternative routes.

By limiting the administrative power to bag checks instead of showing courage to stop major leakages, the government, which holds the strong trust of the public mandate, will neither make a significant difference in revenue nor gain any moral ground. Rather, it risks making the daily lives of the grassroots even more difficult and humiliating.

• The issue of local trade and production

Along with revenue collection, another major argument for this rule is the preservation of domestic production and local trade. Due to the open border, Indian goods have such a dominance in our markets that Nepali small traders have become too weak to compete with them in terms of price and accessibility. In such a situation, the tightening of the border must have aimed to create hope that people would turn towards Nepali shops and our industries would get some relief.

However, the reality of the border market is different. India has kept the GST rate very low on food grains to make the kitchens of its citizens easier, which has made shops across the border a reliable market for Nepali consumers to meet their needs and save some money.

Without undertaking the fundamental tasks of reducing the cost of internal production and streamlining the supply system, simply wielding the stick of customs duty will naturally lead to an increase in the price of goods in the market. As long as our industries cannot offer alternatives that suit the market demand and the consumer's pocket, this control-oriented policy is certain to make the kitchens of ordinary citizens more expensive.

The brunt of this will fall on the poor, for whom the cheaper market across the border is a major support for their livelihood. Beyond these market and production calculations, if constructive reforms are not made, the damage this policy will inflict on the social psyche of border residents is certain to deepen.

• 'Survival Economy' and the story of humiliation

Some decisions made at the policy level in Kathmandu may seem practical, but their implementation on the ground at the border appears equally difficult and impractical. For border residents, the Indian market is not just a cheaper alternative but also an essential basis for their daily sustenance.

Thousands of people there go to India in the morning for employment and return in the evening carrying a few packets of lentils or rice from their hard-earned money. However, recently, security personnel at the border crossings have not only been snatching bags and scattering goods but also behaving indecently towards women and the elderly, disrupting the lives of the local people.

It is wise to revise the current impractical limit to at least five thousand rupees and to make the customs process technology-friendly by clearly classifying household and commercial goods.

This hardship faced by ordinary people in the name of collecting customs duty seems to be generating resentment in the border areas. The risk of sowing serious social discontent is increasing when migrant workers, who have worked tirelessly for months in India and packed a few clothes and gifts for their families, face humiliation and harassment from security personnel at their own border instead of a welcome.

It should not be forgotten that the people of the border areas, by giving a nearly two-thirds majority to the Rastriya Swatantra Party (RSP), which now leads the government, had expected a new and hopeful era of prosperity. The people did not vote for enduring humiliation or being manhandled by their own security personnel.

If the struggle of the grassroots and the dignity of the citizens are ignored in this manner after taking the reins of power, it will not only damage the relationship between the state and the people but also create a deep chasm in the great public trust that has emerged in the new leadership.

• Sensitivity and the relationship between the two countries

The Nepal-India relationship is not just a product of border lines or government treaties and agreements between two sovereign nations. It is also a cultural heritage of social harmony from the time of Ram and Sita. For the residents on both sides, this border is like a single society where daily kinship and marriages take place. In such a historical context, the strictness of paying customs duty even on minor purchases exceeding one hundred rupees has not only stopped goods but has also increased concerns that it might shake the hearts and long-standing trust of the border residents.

Especially, when daughters and sisters going to their maternal homes to give gifts have to face treatment like criminals at their own border, citizens feel insulted by the state. The fact that the Indian Ministry of External Affairs is also closely watching these developments indicates that this issue is no longer just a normal administrative matter for us.

Will this harmony, built on the foundation of unbroken public relations for years, be undermined by suspicion and mistrust? Ignoring such sensitivities related to the dignity and daily lives of citizens risks weakening the very cord of mutual trust. No treaty or agreement in the future will be able to easily restore this.

Therefore, in the name of increasing revenue, harassing such a historical relationship does not seem strategically beneficial. When the legal route becomes cumbersome and humiliating, people are forced to choose alternative paths, and this only increases the voice of public grievances. Hence, instead of harassing small consumers at the border, it is necessary to show courage in stopping major leakages and making the customs process digital, thereby limiting the discretionary power and arbitrary authority of employees.

If taxes are to be levied on such consumer goods, revising the current impractical limit to at least five thousand rupees would be a wise option. And, understanding the sensitivity, it is also necessary to clearly classify household and commercial goods. This is because it is not just to collect taxes by treating ordinary gifts brought back from a visit to one's maternal home, goods brought by returning migrant workers, or medicines prepared for elderly parents, the same as commercial goods.

In addition, making the tax payment process hassle-free and modern should be another essential duty of the state. The current system, where ordinary people have to wait in line for hours and go from one room to another to pay customs duty, is what creates an environment for invisible transactions at the border.

Therefore, if the customs system can be made easy and technology-friendly, allowing one to pay taxes and leave within 10 minutes, then the scope for employees to demand bribes will be closed. With simple and transparent services, citizens will also feel like respected citizens when they set foot on their own land. Otherwise, it will not take long for humiliated citizens to take the step of rebellion, as can be seen from the recent past.