Boulder export business to Bangladesh hits rock bottom in Gelephu
GELEPHU, Bhutan (Kuensel/ANN) - Hundreds of trucks have been lying ideal for about 15 days, as boulder export business in Gelephu has come to a standstill.
Gelephu opened its gates to export of boulders to Bangladesh in November last year. The business flourished in its initial days as exporters swarmed the Moa Khola to collect stones and boulders.
However, lately, some confusion between the Bhutanese exporters and importers in Bangladesh with regard to the weight of the loads ferried has resulted in the halt affecting both.
According to exporters in Gelephu, the importers have recently set a limit (15 metric tonnes) to the weight of the load that a Bhutanese truck can transport.
However, the limit is restricted only on the paper. This means that irrespective of the actual load Bhutanese trucks carry, only 15MT of boulders can legally enter Bangladesh.
Since the commencement of export in November last year, Bhutanese trucks (10-wheelers) in Gelephu carried some 32MT to 35MT of boulders per consignment to Bangladesh. It was learnt that exporters on exiting the border gate declared only half the actual weight (15MT) on paper. According to a source, the remaining 17MT to 20MT were ferried illegally.
This was done to evade taxes on the extra load for both the exporters and importers. “For the undeclared load, the importers paid us in Indian currency.”
One exporter (name with held on request) said importers are liable for 5 percent tax on each MT of boulders supplied from Bhutan. “They are willing to accept 15MT and pay tax for only that quantity. However, they are also willing to take in as many boulders as we can supply, but without paying tax.”
Because of this reason, he said Bhutanese exporters are now asked to carry documents that would reflect only 15MT on the paper. “But they (importers) will pay us for the remaining load in Indian currency. We call this under table money.”
Until April 24, every 10-wheeler truck leaving the border gate in Gelephu carried at least 32MT of boulders to Bangladesh. It was learnt that the Natural Resources Development Corporation Ltd (NRDCL) who supplies boulders in Gelephu initially supplied 25MT of boulders per truck.
However, the quantity was increased to 32MT after trucks were seen carrying loads that were visibly extending from the truck’s bed.
The weight difference
Kuensel learnt that trucks carrying 32MT of boulders from NRDCL pay royalty for only 15MT and the same amount is declared at the trade and customs departments for processing documents.
The difference in the weight was recently noticed and the customs department called on a meeting to standardise the weight issue. After two meetings held with the exporters association in Gelephu and relevant stakeholders last month, it was decided that for uniformity, all trucks must carry only 20MT of boulders.
It was also learnt that the annual business income tax would be levied based on the quantity supplied by the NRDCL and not on the quantity that is reflected on the exit documents.
Officials who did not wish to be named said that exporters tampered with the receipts and declared false weight while exiting the gate. “We knew that the trucks were obviously carrying more from physical inspection. However, since we don’t have a weighbridge, there was nothing much we could do.”
It was also learnt that there are three different measurements considered in exporting the boulders currently. The NRDCL and department of forest measure the boulders in terms of volume, cubic feet (cft) and cubic metre (m3) respectively. The trade and customs departments on the other hand use mass, metric tonne to measure the mineral.
According to sources, the difference in the units also adds to the confusion, as the conversion values are not uniform.
Exporters are now requesting the customs department and agencies concerned to consider their issue and reflect only 15MT on the document for export, while allowing it to carry its regular load ranging from 30MT to 35MT per consignment.
“Since they have already set the precedence, now they should allow us to continue with the same practice until the problem is resolved,” said Sonam Dorji. “However, this time we are ready declare all the income, including the under table money but they have to also consider the collections made along the route by local goons.”
Another exporter, Raju, said that his company has invested millions in dredging works along the Moa Khola. “I’ve some 40,000MT of boulders in stock. The payments are made only on disposal of the materials,” he said.
He said that with the recent circular from the cabinet that instructs exporters to dispose off all the stocked materials by August 31 adds to the pressure currently faced by exporters. “We are working against time here. And on top of that the recent issue where the export has come to a halt is killing us all,” he said. “The sudden change in the rules have affected all of us in the business.”
It was also learnt that while exporters in Gelephu are facing such issues, boulders continue to leave from places like Kalikhola in Dagana and Ngalam in Samdrupjongkhar.
One of the exporters said that it is not possible to ferry only 15MT given the high cost involved in transportation. He claimed that a truckload of boulders (15MT) fetched Nu 28,000 (US$ 389). The expenses including fuel, driver charge and extortion money collected along the way stood at around Nu 32,000 (US$ 444).
“There is no way that those trucks claiming to be carrying 15MT are actually carrying that quantity. No one does business to suffer loss,” he said. “So when they are allowed to go with 15MT documents, why are we not allowed?”
He said that recently some parts of Meghalaya have also started exporting boulders to Bangladesh. “Given the short distance, they can play with the price and kill our business,” he said. “If this issues are not resolved at the earliest, boulders in Bhutan will remain boulders with zero value. People across the border would reap the benefits when the deposits are washed away into their territory.”
Meanwhile, some 40 trucks that left with 20MT of boulders as per the interim limit set by the customs department from Gelephu have been stuck in Bangladesh since last month. “Even if the weighbridge is put in place, this issue would not be solved unless the counterparts are willing to increase the weight limit,” said another exporter.
It was learnt that five of the trucks returned after forcefully unloading the boulders on May 8.
In a recent interview, economic affairs minister, Loknath Sharma, on the boulder issue said that there are always some glitches but there is nothing the government can do as it is an issue at the local level, with the local residents.
“During the election time, there were some problems but I think it is solved now,” said the minister.
Even if we hold talks at the governmental level, there will always be some glitches. “Basically when they go with the boulders, the trucks were found carrying too much. There is a certain carrying capacity of a truck but Bhutanese trucks were found overloading and paying less tax.”
Lyonpo said that authorities came to know about it and there were some delays. “What we are trying to do is open water ways. That’s the best way to address this problem as the distance will be minimised and we can export stones and boulders to Bangladesh through water,” he said.
“We are trying to deal with it at our level. We have also sent some inspectors of trade to see what we can do in border areas. We will continue assisting exporters even if the problem happens in ground level. The problem usually is between local people not the government.”