Border customs tightened: Mahendranagar sees surge in market activity while Banbasa turns desolate
Kanchanpur: Following stricter enforcement of customs regulations at the Nepal-India border in western Nepal, activity has increased in the Mahendranagar market of Kanchanpur.
After customs checks were tightened at the Gaddachauki border post on goods imported from India, the number of people traveling to the Indian border market of Banbasa to purchase daily necessities has declined. As a result, Banbasa market, once used for regular household shopping, has become largely deserted, while commercial activity has increased on the Nepal side.
Recently, the Armed Police Force and Nepal Police have intensified customs inspections at Gaddachauki and surrounding areas, particularly enforcing duties on goods worth more than Rs 100 brought from India. This has contributed to increased activity in Mahendranagar market. Local businessman Indra Bahadur Bam said that due to border customs restrictions, shopping activity has increased on the Nepal side. He added that people who previously went to Indian markets for cheaper goods are now realizing that the price difference is minimal when transport and fuel costs are included.
“Even if goods are cheaper, if you add motorcycle fuel and customs costs, it becomes the same,” he said. “If customs are tightened at the border, people will be more attracted to doing business in Nepal.” He also noted that while there is a traditional practice of shopping for household goods across the border, enforcement has increased. However, he said security agencies and the Chamber of Commerce and Industry should play a stronger role in regulating customs, and that people attempting to bring goods for household use and religious purposes have recently faced difficulties.
On the other hand, the Indian border market Banbasa has historically relied on Nepali consumers. Indian traders say business in Banbasa has been affected due to stricter Nepali customs enforcement. An electrical shopkeeper from Banbasa said Nepali customers used to regularly purchase items ranging from fans to refrigerators and coolers, but now the market has seen a sharp decline.
“Many businesses here are now struggling. Our market used to depend almost entirely on Nepali customers. But now they have stopped coming. Even if they come, they buy only small items,” he said. He added that since customs duty applies when importing goods into Nepal, the final price difference becomes negligible.
He also emphasized that since cross-border trade has been ongoing for decades, the system should allow smooth movement of goods even with proper customs payment at the border.
Prem Prakash Sigdel, commander of Armed Police Force 35 No. Shaileshwori Battalion in Kanchanpur, said facilitation would be provided for farmers bringing fertilizers, while others must bring goods by paying customs duties. “Customs clearance has increased due to stricter enforcement at the border,” he said. “The number of people going to border markets has also decreased compared to earlier.”
He added that the previous practice of bringing goods worth more than Rs 100 without paying customs duty has now been strictly implemented, which has increased business activity on the Nepal side. The transport of goods by bicycle from Banbasa to Mahendranagar and surrounding areas has also declined.
“The earlier practice of bringing goods for weddings, festivals, and other occasions without paying duty has now stopped,” he said. “The commercial calculation can no longer be considered practical.” Daily consumer goods, clothing, and electrical items are now processed through Gaddachauki customs.
Madhav Joshi, General Secretary of the Nepal-India Friendship Association, said that although stricter border customs may have caused short-term inconvenience to citizens, it has been beneficial for the state overall. “It is natural that trade toward Nepal will increase and foreign trade will be affected due to customs restrictions,” he said. “The current restrictions have increased the use of Nepali products, helping domestic industries find markets and grow.”
He stressed that regulatory bodies should continue strict enforcement, as it could increase employment and domestic trade. “Even during the COVID-19 pandemic, we survived using Nepali goods,” he said. “Although imports from India have decreased, overall state revenue does not necessarily fall. Smuggling that previously occurred in the name of household goods has now been controlled.”
Meanwhile, Kanchanpur Chamber of Commerce and Industry President Dinesh Malla said Nepali citizens returning from work in India should not face hardship due to border restrictions. “Our brothers and sisters returning from India also bring their belongings, they should not suffer in the name of customs clearance,” he said, adding that stricter regulation of goods transported by vehicles may also be necessary.