Phuentsholing Mini Dry Port (Photo: CUTS CITEE)

Prices of commodities shoot up due to increased loading and transshipment charges in Phuentsholing

There is a trend of price hike in goods after the COVID-19 pandemic. Bhutan is facing unexpected price hike in all the goods given various factors, like the numerous charges to be paid while importing the goods.

The process of shipping in the goods from the source of production, transshipment at Phuentsholing Mini Dry Port (MDP) and truck parking (temporary), and again having to transship the goods at Sorchen and getting the things delivered at escalating prices, has everyone worried.

If not monitored and investigated, the price of the commodities may reach to certain level that the individuals at the low-income group may not be able to afford to live off their meager earnings in the near future.

In some incidents, the importers, especially those who run small shops, pay cash of Nu 2,500 to Nu 3,000 extra to drivers upon delivering their consignments on time. This is after paying off the loaders separately using the online apps. “This is no less than a daylight robbery,” said an importer.

Marpa who owns a wholesale grocery shop in CFM said, “Everything has become challenging for us. Starting from vehicle registration to delivery of goods has become an issue. In today’s scenario, transportation has become so expensive.”

Before the hike in transportation charges, a Bolero would charge Nu 16 per cartoon, but now it has gone up to Nu 120 per cartoon. It is acceptable at certain point, but with the process of transshipment, the damage and loss of goods is becoming another issue, he said.

Already they have to pay many charges, and having to bear the losses caused by damaged goods is frustrating, he said, adding that no drivers are ready to take the blame.

“There is a vast difference in bringing in the goods before and now. Before while loading, the charges is Nu 10 per cartoon while now it has shoot up to Nu 60. The transportation charge has also gone up drastically,” he said,

Those could be various factors on why there is hike in price for every commodity, he said.

Ugyen Tshomo, owner of a garment shop, said that nothing is like before, whereby, everything incurs charges, from bringing in the goods to transporting and delivering the goods. Before, they used to go, in person, to Jaigaon to bring in the goods without having to pay any charges, she said.

“Now that we can’t go, everything depends on how much extra we pay to them. We are paying Nu 8,000 per sack. We did not have to pay such a huge amount in the past. To transship our goods, we again have to pay the loaders, and to get our things delivered from Sorchen, we have to pay separately,” she added.

The shopkeepers and wholesalers commented that they are being looted as money has to paid to various people to get in the goods. Due to such a situation, they said, they have no choice but to increase the price of commodities.

“We get so many complaints from the customers, whereby, once an official from OCP even came to investigate, she said, and further added,  “We get so many goods with defects, which we cannot return as like before. We cannot select the goods of our choice, and that is why we receive many goods with low quality. This adds to our hardship.”

Considering all the factors, she said, there is no other options than to keep the business running, even with no profit.

Jigme, a fruits and vegetable vendor, said that before they used to bring in the goods at Nu 18,000 per consignment, and now with so many charges in between he has to pay Nu 20,000 to Nu 30, 000 to bring in the goods.

“I feel that there is no need of changing the driver from Sorchen, as this seems like an unnecessary expenditure. Vegetable businesses have no profit like grocery items. We have to increase the price according to the expenditure we incur,” he added.

The price from the source is same as like before, but there is more expenditure in shipping and delivering the goods, so the increase the price has to be made to cover the costs.

“Profit is not much, but we need to sustain as that is only the source of income we have,” he said.

“There are many processes and protocols to be followed which I feel is unnecessary as it only contributes to price hike of the commodities,” he added. 

An owner of one of the shopping marts in Thimphu shared that everybody is selling goods above the MRP, and when one cannot control that then it becomes impossible to monitor the price of the goods coming from the third county.

He said, “I feel that the concerned government agencies should monitor the price hike. Some of the companies have not increased the price of the commodities but still the shopkeepers hiked the price.”

However, there are lots of factor contributing to price hike, he said, adding that the various charges collected at the MDP, during the transshipment and loss of goods are some of the major factors.

There has been an issue with the protocol in importing the goods. So, if government can monitor everything according to the existing laws then these issues can be addressed, he added.

The importers in an earlier interview claimed that it is better to pay few extra thousands and get their consignment rather than keeping it in queue for many days paying high demurrage charges and taking risk of damage.

For those who refuse to pay extra, their consignment stays out for a number of days unattended with a lot of damage. The traders have also complained of missing items from their consignments when it reaches to Thimphu, though they are not sure when and how items go missing.

The ACC’s investigation in the MDP also involves such charges by loaders.

At the same time there are also some manufacturing companies in India that have increased their MRP on the product. The small-scale business people buy goods from wholesale shops within their community, and when the price from the wholesale increases, then they have to increase their prices as well. In doing so, the ultimate impact is borne by the consumers.

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