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Bhutanese exporters cry foul over illicit practices in cardamom trade

Cardamom exporters in Phuentsholing are crying foul over declining cardamom prices. Owing to certain illicit practices across the border, traders are at the losing end while determining the cardamom prices.

With the influence of Indian traders, the Bhutanese exporters have been facing challenges, unable to export their product. Bhutanese cardamom unlike cardamom of northern India is exported directly to Bangladesh.

However, Indian traders with the help of some Bhutanese traders have adopted the practice of mixing low quality cardamom from Siliguri in West Bengal. The traders mix the Indian cardamom from Siliguri and enter Bhutan via Jitti border, in Samtse.

After that, they bring the product in Phuentsholing and pack it and re-export to Bangladesh. For example the traders enter with such cardamom from Siliguri via Jitti border and then bring to Phuentsholing after completing the customs procedures.

With the mixture of inferior quality cardamom from India, the traders fix the market rate and pay to Bhutanese farmers who have superior qualities. “Our cardamom has better quality and could fetch better prices than today. But because of such practices, our farmers are unable to receive the deserving prices,” Singye Wangdi, a Bhutanese exporter said.

The traders say that the Bhutanese exporters do not have liberty to determine the prices. Since, Indian cardamom is not exported to Bangladesh owing to 100% tax, the traders grade the cardamom and inferior qualities are imported to Bhutan.

“The Indian dealers play around the prices. It’s a great loss to our farmers who toil hard in the field,” said Singye Wangdi. The price has now decreased to Nu 450 per kilogram. It had gone up to Nu 550 per kilogram after complaint from these traders but again the prices have decreased.

Also, deceptive practices are common in cardamom trade by these Indian traders who offer better prices than the Bhutanese exporters but cheat in weighing machines. With no more than five Bhutanese exporters most of the cardamom in Phuentsholing in bought by local Indian traders who run businesses in Phuentsholing. “The effort must be put to stop entrance of Indian cardamom. There are others too working on it. Otherwise our Bhutanese cardamoms are in good demand and could fetch better prices,” said Singye Wangdi.

Another trader, who echoed him said that while it is evident that the practice is prevalent, but it has become difficult to prove as it is practiced cautiously. “Everyone is aware of it but nothing is being done. We can’t prove without evidence,” said Sonam Tobgay, another exporter. He has not exported for a month now.

In 2016, he incurred a loss of more than Nu 5mn. The Bhutanese exporters feel that it has become impossible to compete with their Indian counterparts even in Bhutanese market. He plans to explore markets outside Bangladesh and in the middle-east where the demand is huge. “It has made us useless. They rule the market and we just watch,” he said.

Also, it was learnt that few Bangladeshi traders have already the entered Bhutanese market and they supply directly to Bangladesh. “Entering of international traders in the country has become a threat for our survival. There is no work for genuine exporters like us,” said Sonam Tobgay adding that the Bhutanese authorities are mollycoddling them by providing licenses to operate businesses if they give commissions.

Bhutanese cardamom became popular over a decade with increasing numbers of farmers interested in cardamom cultivation.

Krishna Ghalley from Phuentsholing

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