Nepal Violence Continues to Impact Border Trade with India.
Raxaul, India – Ranjeet Kumar, a shopkeeper in Raxaul, Bihar, expresses gratitude for the business he continues to receive from patrons in Nepal amid recent events in the neighboring nation. Kumar oversees a century-old establishment specializing in religious items, located just 800 meters from the India-Nepal border. His shop primarily caters to customers looking for items used in daily Hindu prayers, such as sacred threads and fire pits for ceremonies. However, the ongoing antigraft protests in Nepal, which sparked on September 8, have resulted in a noticeable decline in cross-border sales.
The protests, predominantly led by a younger generation, have resulted in significant unrest, leaving 72 individuals dead, including one Indian national, and injuring over 2,000. Despite a week-long border closure during the violence, local residents were granted temporary access to India, allowing Kumar’s business to mitigate the financial strain. “They came and went back quickly,” he noted.
Unfortunately, not all traders have been as fortunate. Arun Kumar Gupta, a 55-year-old cloth merchant in Raxaul, indicated that his business faced paralysis due to the violence, presenting challenges in meeting payroll for his three employees. “Over 90 percent of businesses in markets bordering Nepal rely on Nepalese customers,” Gupta explained.
The India-Nepal border stretches approximately 1,750 kilometers (about 1,088 miles) across five Indian states. Its porous nature allows for seamless travel, with citizens permitted to cross without needing a passport. This unique arrangement facilitates substantial trade reciprocal benefits between the two nations. India plays a pivotal role as Nepal’s largest trading partner, accounting for roughly two-thirds of the country’s merchandise trade.
The economic partnership between India and Nepal was further evidenced by their bilateral trade amounting to .5 billion during the 2024-25 fiscal year, with India exporting goods valued at approximately .3 billion while importing .2 billion in return. Items traded range from essential supplies like petroleum products and chemical fertilizers to cultural goods, reinforcing the interlinked nature of their economies.
Following the political upheaval, Prime Minister KP Sharma Oli resigned, paving the way for Sushila Karki, a prominent legal figure, to serve as interim prime minister. The government’s announcement for elections in March signifies hopeful prospects for stabilizing the situation. Although violence has diminished and trade across the border has resumed, merchants remain apprehensive about returning to standard spending habits due to lingering fears of instability.
As Dashain, Nepal’s most significant festival, approaches, traders are anxious about potential financial repercussions. Traditionally, the festival witnesses a surge in cross-border shopping, yet current circumstances are likely to dampen consumer enthusiasm.
The economic ramifications extend beyond immediate border towns. For example, in Muzzaffarpur, Bihar, known for its production of lac bangles, local merchants report a complete halt to supplies as a result of the unrest. With the anticipated festival season, the demand for these traditional items has sharply declined, leading traders to face challenges in managing their inventories.
Tourism, another vital sector for Nepal, is also suffering due to domestic unrest, which contributes around 8 percent to the country’s economy. The closure of international airports and instances of vandalism have deterred travelers, raising concerns among industry insiders about long-term repercussions for the tourism sector.
The recent tensions in Nepal underscore the interconnectedness of local economies and the broader political landscape. As communities on both sides of the border navigate these challenges, their resilience reflects a shared spirit that transcends current difficulties.
#WorldNews #MiddleEastNews
