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India-dependent Nepal struggling with food shortage

nepal blockadeKATHMANDU: The market has started running short of daily essentials as unrest in the Tarai and an unofficial Indian blockade tightens the stranglehold on the country.
Cooking oil, sugar and pulses, in particular, have become short with both wholesalers and retailers reporting they are fresh out of stock of oil.

Factory owners said that they had not been able to produce oil due to a shortage of raw materials resulting from the Indian blockade.

Nepali factories imports crude cooking oil from Malaysia, Brazil, Argentina and Indonesia and processes it, but the Indian blockade has cut off their supply lines.

“We are fulfilling only 20 percent of the country’s oil requirement as we cannot get raw materials,” said Kumud Dugar, managing director of the KL Dugar Group.

“We have become unable to produce oil right at the time of the Dipawali festival when demand surges.”

Banks said they had not issued letters of credit to import goods from third countries as Nepal-bound cargo lies stranded in India.

Life has become hard for the general public as retailers are fast running out of stock. Pabitra Ghimire said she could not buy cooking oil at the neighbourhood stores on Tuesday, adding that prices of food products had also risen.

“I was shocked when the shopkeeper charged me 70 rupees for a kilogram of sugar that cost 62 rupees before the Dashain festival,” she said. Likewise, soybean and sunflower oil cost 180 rupees to 195 rupees per litre, against 125 rupees per litre a month ago. The price of rahar pulse has almost doubled to 270 rupees to 320 rupees per kg from 140 rupees per kg over the same period.

Many retail stores in Gyaneshwor, Ratopool, Gaushala, Mitra Park and Chabahil said they were having a hard time getting merchandise from their wholesalers.

Consumers could be seen returning empty-handed as the shops had run out of stock of the goods they wanted. Deepak Batala, a retailer at Ratopool, said that he was running out of stock of many things apart from daily essentials.

“One of my regular suppliers asked for 1,900 rupees for a carton of soybean oil that I used to get for 1,400 rupees,” he said, adding that wholesalers of mustard oil and pulses were also charging more citing the shortage.

Nawaraj Upadhyay, another retailer at Ratopool, said that wholesalers had been fixing new prices every week. “Each time I order essential goods, my wholesaler charges me a new higher price.”

Pabitra Man Bajracharya, president of the Retailers Association of Nepal, claimed that they were not responsible for price hikes amid a growing black market in essential goods.

“We are selling whatever we have in stock by attaching a small mark-up. According to the association, prices of wheat flour, corn flour, beaten rice and spices have also soared in recent days,” he said.

Wholesalers and manufacturers, for their part, said that shortages had appeared due to a halt in production and imports.

They added that the situation could worsen in the next few days as all the factories had closed, and their warehouses were fast emptying.

“We are in a fix right now. Factories are closed due to a shortage of raw materials and fuel. The country would face a severe shortage of daily essential in the coming days if the situation remains the same,” said Manish Kumar Agrawal, an executive member of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and the director of Shree Krishna Oil Refinery. – From Kathmandu Post

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