Areca nuts pile up at Indian border

Myanmar is facing a glut of areca, or betel nuts in border trading areas near India due to an influx of the product from Indonesia even as the Indian government continues to limit the import of agricultural goods from Myanmar, traders say.

Areca nuts were a major export to India via the Tamu border trading point in Sagaing Region, and the Rhi border trading point in Chin State, until India decided to close its border gates and crossings.

As part of a preferential trade agreement, India used to allow the tariff-free imports of areca nuts from Myanmar via the Tamu and Rhi trading gates.

However, a year ago, India imposed a tariff of 40 percent on the product after it said areca nuts from Indonesia were entering the country via Myanmar. As part of efforts to control the inflow of the product, the Indian government also began closing border crossings.

Since last May, the Indian government banned vehicles from crossing the Myanmar-India border bridge in Rih Khaw Dar which is part of the Rih trading route in Chin State.

Meanwhile, the Tamu border trade station in Sagaing Region has been closed for nearly two months, bringing trade to a halt said traders there.

“The situation is very bad. Due to the large quantities of nuts from Indonesia, the prices of our Myanmar nuts fall and transaction drop. Myanmar traders have to buy and sell to each other instead of across the border. Profits have dropped drastically as the India side is closed and transactions have totally stopped,” said a nut merchant in the Tamu border area.

Due to the situation, thousands of bags of areca nut are piled at the Tamu border area and warehouses are also full to overflowing, said a merchant.

Due to the closure of the Tamu border gate, people who trade Indonesia areca nut send their goods to India via Rhi in Chin State. Although thousands of tonnes of Indonesia and Thai areca nuts are sent every day, little of it is from Myanmar. The entry of nuts from other countries to India occurs due to Indian trade agents in Myanmar transporting the nuts via Myanmar, said a female merchant.

According to the Kalay-Tamu Border Trade Merchant Association, the export of areca nuts from the Rih and Tamu trading areas has more than doubled, from 16,500 tonnes in 2013 to 40,000 tonnes in 2017.

Myanmar’s annual areca nut production is just about 10,000 tonnes and the rest is illegally traded from Indonesia to Myanmar passing through the Myawaddy border with Thailand and then re-traded to India, said the association.

According to a trader from Tamu, Indonesian areca nuts started entering Myanmar some four years ago before being re-exported to India. Over the last two years, the quantity has risen massively, said the trader who declined to be named.

“The imports should be controlled so it is better for everyone, but now, the businesses of areca nut traders from Myanmar including me are suffering,” the trader said.

Although the Kalay-Tamu Border Trade Merchant Association submitted a petition to the government to bar the illegal trade of areca nut from Indonesia to India via Myanmar, smuggling is still going on, said another trader from Tamu.

“The market gained by Myanmar is stolen by illegal betel from Indonesia and Thailand. We have reported it to the government and it should be dealt with to protect Myanmar betel market. If not, betel from other countries will enter India and will corner the whole market and Myanmar betel will not fetch a good price,” he said.

Although India is closing trade routes and increasing tariffs on betel, it has not managed to halt the trade completely, said border traders.

“Although India is saying it isn’t accepting betel nut from other countries, they are entering from Rhi and Tamu. Two thirds of the betel entering India is from other countries. Myanmar betel doesn’t even make one third of the market. For every five trucks with Indonesian betel entering India, only one Myanmar betel truck crosses the border,” said a Tamu trader.

Thousands of sacks of betel are exported to India via the border near Rhi. Although the border crossing is still blocked, the cargo is transported with workers and carts, which increase the costs, said Chin State Border Trade Organisation Secretary U Ket Noe.

“As vehicles can’t cross the border, the cargo is transported by manpower and as the price is not stated there, the trade is more like barter. There is no stated place for the trade and people are going with the flow,” he said.

The present closure might be retaliation for previous detention of 16 fertiliser trucks from India which entered via Chin State, he said.

“All borders are always like that. According to the circumstances of our country, any border gate cannot be said to be advantageous than another,” said U Zaw Htay, financial officer of Tamu Border Trade Association.

The Chin Border Trade Association has also asked for help from Vice President U Myint Swe regarding the border closure by India, he added.

“Both the Vice President and Minister of Commerce said they will enquire and make necessary arrangements,” he said.

Source: Myanmar Times

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