Crush Middlemen

The Nepali word ‘bichauliya’ (middleman) has gained currency in politics and economy. But the intermediaries have earned notoriety for their damaging role in society. In the past, bichauliyas reportedly accessed the prime minister's kitchen cabinet and influenced the government to bend the rules to their benefit. Recently, a powerful businessman was arrested for money laundering. In a video, he has claimed that he has the capacity to bribe and manipulate big political parties when it comes to making or breaking the government. This shows how influential bichauliyas are. In left political parlance, this sort of bichauliya represents the comprador class that makes money without investment and entrepreneurship. As the high-profile politicians collude with middlemen, the value-based politics takes a back seat and the nation is bound to suffer. 

Other kinds of bichauliyas work as retailers, wholesalers and agents, and cause immense economic hardships to consumers through their profiteering behaviour. In a vast supply chain, they bridge between the producers and consumers by facilitating the transactions of goods. When they charge an exorbitant cost for supplying the products, their prices go through the roof, leading to high inflation that affects every aspect of economy. Middlemen squeeze both producers and consumers, and reap undue profits during the time of crisis – natural disaster, transportation strike, economic blockade, energy crisis and political instability. Currently, the country is feeling the heat of shortage of fuels due to the war in the Middle East. The government is compelled to raise the prices of fuels several times to adjust their prices in the international market.  

However, the middlemen are now fleecing the people on the pretext of ongoing energy crisis. They have created artificial price hike of vegetables, fruits, foods and other consumer goods. One glaring example is the soaring retail costs of banana. One dozen of banana now cost around Rs. 350 to 400. While famers and consumers feel cheated, the middlemen are making a fast buck. On Tuesday, the Federation of Nepal Banana Producers’ Ad Hoc Committee clarified that farmers had not increased the prices of banana. It has said farmers are getting significantly lower prices at the farm gate than the prices charged in the market, according to a news report of this daily. Local varieties such as Malbhog are being sold for just Rs. 70–85 per dozen, while hybrid varieties like William and G-9 bring only Rs. 50–60 per dozen. On the other hand, consumers have to pay up to five times more in the retail market, thanks to the interference and manipulation by brokers.

Banana farmers have raised only Rs. 6 per dozen compared to the last year. The significant price variation for bananas between the farm gate and retail shops indicates poor market monitoring. Though there is a short supply of bananas in the market, the local production still covers around 70 per cent of market demand. Around 50,000 to 60,000 tonnes of bananas are supplied monthly from various parts of the country, against a demand of 80,000 tonnes. The government has imposed a ban on the import of bananas to prevent the spread of the dangerous TR-4 (Panama) disease, which threatens banana crops. This has also encouraged the local producers. With the rapid expansion of domestic production of bananas, Nepal can attain self-reliance in it. The government must control the middlemen so that consumers do not feel bitter when they pay through the nose to get the sweet fruit.