Raw Silk Route – The Opening of Nathu La

June 2006

Rows of prefab warehouses under corrugated iron sheets at Sherathang, 7 km shy of Nathula. A highway still in the making. A wary state watching what opening the borders to trade can do to its politics and demography. The big picture of Sino-Indian relations. And a cloud cover that almost every day reduces the historic pass to a zero-visibility zone.

Welcome to Silk Route II.

There is no escaping the steep sense of ambivalence that pervades Sikkim as it prepares for the historic opening of Nathula on its border with China, part of the old 563-km Silk Route from Siliguri to Tibet, closed since the 1962 war with China. The projections of the long-term benefits of border trade notwithstanding, the Pawan Chamling government has to grapple with more immediate issues back home—local political discontent, the skepticism of traders, the identity crisis of the Bhutia-Lepcha community.

The Directorate General of Foreign Trade has finalised a list of 15 import and 29 export items for trade between India and China that could start by the end of this month. This, even as the immediate beneficiaries of the reopening question the planning that has gone into the reopening of the trade route and the almost laughable infrastructure that is being readied for the kick-off.

The warehouses built of prefabricated materials at Sherathang will serve as a temporary trade and exchange area for goods from China but local traders believe the structures are as inadequate as inappropriate. The rush, they feel, is only explained by a somewhat hurried politico-diplomatic rationale.

The Sikkim government admits that the initial five-year phase will be symbolic, a sort of a “dry run”, but it has in its possession a study which envisions trade across the pass touching $1 billion by 2010. With the 56-km road that connects Nathula to Gangtok impossibly thin and unsuitable for heavy vehicles—and the Border Roads Organisation (BRO) saying it can double-lane the road only by 2010—the estimates, even according to the Sikkim Chamber of Commerce, are more than far-fetched.

In the event, the two governments will progressively pick out other routes, including the one through Jelepla, with the tacit admission that Nathula alone cannot promise the large bilateral trade that bettered politico-economic diplomacy has promised.

Abhishek Goradia, a businessman from Kolkata who was at Nathula last week, looked startled: “They say there will be an opening in the next few weeks and they have just made the two sides reach the same level.” After a joint survey last September, the BRO has spent the past six months cutting 5.5 metres deeper into this side of the border to bring it on par with China’s naturally surfaced approach.

Siliguri-based truck fleet operator Vimal Bazla, who has operations in Gangtok with local partner Subhash Sarkar, believes the reopening of the pass will allow him to bring back Chinese goods from Gangtok to Siliguri instead of receiving empty trucks. Raaz Khan of Gangtok’s Deorali United Traders Association indicates that more products from China is good news: “For now, the import items are mainly hardware and raw materials, but over time, foreign money will pour in.”

But while there is no debate on the long-term dividends, the run-up to the opening, cautious Sikkimese businessmen say, is at best “a waiting game”. The Department of Industry & Commerce took a group of 14 traders to Sherathang at the end of May on a “familiarisation mission”.

Among them, Jeevan Agarwal, a third-generation immigrant to Sikkim from Rajasthan who plans to tap Chinese imports to expand his consumer electronics and tobacco businesses, says, “There is nothing here for proper trade. They are planning to expand it and make permanent structures, but I don’t know when that will happen.” Agarwal’s father used to ply the pre-1962 original Silk Route and even had a trading centre in Yatung in Tibet but Agarwal is not charmed.

And he has his reasons. The Chamling government has decided that import licences will, for the first five years, be given only to Sikkim subjects. “We have voting rights, everything else, but for five years, we won’t have a piece of the action,” says Raman Nath, a third-generation resident from Haryana, who sells smuggled shoes in Gangtok, where cheap Chinese products make their way from Dhulabari in Nepal to Siliguri through Kathmandu.

For now, the large non-Sikkimese Indian population and traders from outside will be forced to either wait for five years or partner with local businessmen. “There are no short cuts,” a state government official admits in private. “Everyone’s interests have to be met and it will take time. The economy of Sikkim has to be well protected because this is a big step we are taking.”

The native Sikkimese Bhutia-Lepcha community, which now accounts for 21 per cent of Sikkim’s population, is deeply disturbed by the prospect of the reopening leading to a deluge of refugees and the schisms this could engender. “Our main concern is being outnumbered in our own homeland,” says Tseten Tashi Bhutia, former tourism minister, vice-president of the Sikkim Pradesh Congress Committee and convenor of the Bhutia-Lepcha Apex Committee. “How long can we tolerate this? How long before AK-47s are taken up?” That Chamling’s Sikkim Democratic Front is an ally of the UPA, is a predicament for the PCC chief.

S Yongda, chief coordinator of the influential Assembly of Sikkim Monasteries, warns violence could be in the offing. The lone opposition MLA in the Sikkim Assembly, Acharya Tshering Lama, a Lepcha monk from the Congress, says he recommended to the ruling SDF that a white paper on Nathula be commissioned before further action, but was told that it could be done only by New Delhi as this was a bilateral issue.

Sikkim DSP Jivan Pradhan is also concerned that law and order would deteriorate once the border is opened. The problem, he feels, is beyond the beefing up of forces on the border. Another persistent view in Sikkim is that burgeoning trade and industry close to the border will progressively destroy the state’s nascent but successful eco-tourism and herbal medicine research industry that the Chamling government has built into a viable source of foreign money. Besides, the potential for commercial complexes, factories, markets and attendant service sector offices, the Sikkimese feel, has already been utilised.

The Sherathang trade zone already has “touristy” infrastructure —the “world’s highest” ATM, long-distance telephone switchboard and cyber-café.

On June 21, a six-member Indian team will return from Lhasa with final dates for the opening of the pass. As bulldozers clear away what still looks more like a granite quarry than a highway racing a fortnight’s deadline to face history, it’s a certainty that waiting and watching will be as much a preoccupation as trade itself on the new Silk Route.

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