Money
Smuggling of petro products rampant in eastern Nepal
Petroleum products are being smuggled from eastern Tarai districts of Nepal to India, putting a dent in foreign exchange reserves of the country. A litre of petrol is Rs16 cheaper in Nepal than in India while diesel costs Rs22 less per litre in Nepal.Binod Bhandari
Petroleum products are being smuggled from eastern Tarai districts of Nepal to India, putting a dent in foreign exchange reserves of the country. A litre of petrol is Rs16 cheaper in Nepal than in India while diesel costs Rs22 less per litre in Nepal. These price differences are giving rise to cases of smuggling of petroleum products, according to Bhanubhakta Khanal, chief of the regional office of Nepal Oil Corporation (NOC) in Biratnagar.
Nepal shares open border with India. This has enabled smugglers to illegally transport petrol and diesel to India. This is draining the country’s foreign exchange reserves because NOC imports these commodities from Indian Oil Corporation through legal channel. NOC settles oil import bills in Indian currency, which Nepal accumulates by selling US dollars earned through sources like remittance sent home by Nepalis working abroad. If smuggling of petroleum products continues, Nepal will lose more hard-earned foreign currency.
Demand for petroleum products has gone up in an unnatural manner in eastern Nepal this year , according to Khanal. For example, demand for diesel in eastern Nepal has jumped by around 21 percent to 700 kilolitres per day this winter and demand for petrol has soared by 30 to 35 percent to 160 kilolitres per day.
Demand for petroleum products generally goes up during winter, as this is the time when most of the farmers use machines to harvest and thresh rice and plant wheat and mustard.
“During this time construction works also gather pace, raising the demand for petroleum products,” said Khanal. “But demand is also going up because gasoline stations located near the Nepal-India border are found to have been involved in smuggling of petroleum products,” said Khanal.
NOC’s regional office in Biratnagar has been supplying around 12 kilolitres of petroleum products to each of the gasoline stations located near the border. “These stations demand more fuel a day after we refill their storage tanks,” said Khanal. “Although demand for fuel has gone up with the advent of winter, how can one station sell such a big quantity of petroleum product?”
NOC has suspected smuggling from gasoline stations located in Rangeli, Karsiya and Dainiya of Morang and Bhantabari, Inaruwa, Sayabgunj, Kaptangunj and Dewangunj of Sunsari. “Also, most of the Indian cargo trucks that enter Nepal return to their country after refilling their gas tanks, which is raising demand for diesel in Nepal,” said Khanal.
Earlier, NOC had barred gasoline stations from selling more than 30 to 40 litres of diesel to each Indian truck.
“But this did not prove to be an effective measure to curb exports because Indian trucks started stopping at a number of gas stations to refill their tanks,” said Khanal.
Over 150 Indian cargo trucks enter Nepal per day from India. The fuel tank capacity of these vehicles ranges from 200 to 500 litres, according to Khanal. Even if each truck fills 200 litres of diesel, Nepal would end up selling around 30,000 litres of diesel to Indian trucks per day. “We have to control this,” said Khanal.