Earlier, the border towns of India ruled the roost where business was concerned, with Bhutanese shoppers flocking in herds for a wider and cheaper variety of goods. But now, with the rupee crunch, the scenario has reversed with Indians entering Bhutan so that the business community of places like Gelephu and Phuentsholing have something to smile about.
The Bhutanese have relatively cut down on their frequent visits to the border towns and there is an influx of Indians who want equal value for their Ngultrum because if they shop with the currency in Jaigaon, they will have to pay at least between 15-10% commission.
Items brought by residents across the border are boil rice which comes in 50 to 25 kg packs, mustard and refined oil (both in tins and bottle), aerated drinks, sugar (50 kg), noodles, milk powder, and toiletries. Biscuits are not in demand.
Ram Prit and Sons grocery shop in Phuentsholing has been catering to about 30 customers from across the border daily, vying for grocery items like rice and oil including snacks.
One of the proprietors of Ram Prit and Sons, Birender, said the profit margin has definitely increased and accepting the Ngultrum is not a problem for them at all. However, there were many who after paying for the items in Ngultrum request for Rupee exchange.
Jatan and Lalchand Prasad, a wholesale dealer of grocery items, has seen double-fold increase in customers in the last few days and it is expecting the numbers to increase in the coming days.
Gelephu town is also witnessing an increasing number of customers from nearby places across the border like Dadhgari, Shantipur, Devshree, and Runikhata.
People from such places come all the way to Gelephu carrying Ngultrum and shop for ration.
However, it is not just the Indians who are making a bee-line for shops in Bhutan. The number of Bhutanese customers who would earlier wait for the Thursday market at Dadhgari has declined drastically.
Since Samdrup Jongkhar has a small population, it has seen only a slight increase in Indian customers. According to Anup Dafffo, A staff of Hanuman Stores, it would not make much difference as the BTN was circulating within the town itself.
However, the tight rein on rupee has posed some hitches even for shopkeepers within Bhutan.
Pravin Kumar Jain, proprietor of Bhanwarlal Jain Grocery shop, said that it was a problem buying goods from India as he had to make payments in Rupee.
The other problem he faced was the charges on transportation of goods. Transporting salt from Bongaigaon was not a problem as he was using Bhutanese vehicles to whom he paid a sum of Nu 5,000.
However, while transporting goods from Siliguri and other places in West Bengal, he was charged in rupee. For instance, a full truck of pulses and rice grains cost him about Nu 20,000.
Manoj Jain of Gelephu Grocery Shop said laborers without work permit posed a dilemma. He had 10 staff such staff and the bank only facilitated about Rs 5,000 for laborers with work permit.
“We have to pay all of them in Rupee which is becoming a hassle,” he said.
Manoj Jain added that from March 29 onwards the bank started issuing Rs 6,000 for transportation costs along with the Rs 5,000 for labor payment.
Jatan and Lalchand Prasad shop’s owner said he was facing a problem only with the work permit issue but the rest was fine, as his shop was making payments for the goods and transportation to their suppliers in Siliguri and Kolkata through drafts.
Many businessmen agreed that those who had been operating illegally were the ones who were at the losing end. Earlier, they used to operate without documents and made draft payments under different names, but, now this practice has come to a halt.
The Rupee crisis has also hit beauty agents like Oriflame and Avon which deliver products on order. Since the agents are based in border towns and have direct link with Siliguri, they accept only INR.
In Bhutan there are a good number of cosmetic dealers who have also been affected. An Oriflame member Cheki Lhaden from Thimphu said she has been unable to supply her customers due to dearth of the Indian currency.
Additionally, the business people running foreign goods and Dhaka sales shops have been facing problems. The wholesale dealers in Nepal and Dhaka are demanding Rupee and only a few Nepali dealers who have been in long term business relation with the shopkeepers are selling the goods in smaller amounts.
Meanwhile, the informal exchange of Rupee is still in practice, but at a smaller scale with commission rate for the Rupee against the Ngultrum at 10-15%. Now, the exchange rate charged during emergency has increased from Nu 500 to Nu 1,000 against Rs 10,000.