Under The Counter

If anything, the acute shortage of essential supplies due to the Indian blockade has created a vibrant black market of petroleum products and other essentials in Nepal. Ever since India imposed blockade in late September , Nepal oil corporation (NOC) has sold petrol and diesel to the public only twice.. However , the number of private vehicle plying on the street  clearly indicates how black marketeering has created a parallel economy. Likewise , though liquefied petroleum gas (LPG)  cylinders are rarely available in the markets from official channels , hotels and resturents continue to purchase them through black marketeers paying double the price and sometimes even more to keep their business running.

Black market, also known as shadow economy is illegal and discouraged for a simple reason - it crimps government revenue and extorts the public. According to a report by the International Monetary Fund titled 'Hiding in the shadows: The growth of the Underground Economy ' ,expansion of the shadow economy can start a cycle of tax evasion. As a result of illegal transactions , tax revenues remain lower that what they should be.

On its part, the goverment claims that it has been keeping a tab on black marketeering. But even the state-owned sole supplier of petroleum products , the NOC , has been suspected of being involved in this racket. Moreover , monitoring officials often allow those arrested to go Scot-free. So , while the goverment needs to control black marketeering , it also needs to make sure that the bureaucracy is not  involved in this illegal trade . In case goverment officials are found guilty , they need to be severely punished . But as supply deficit lies at the heart of the problem of a thriving black market, the goverment must ensure smooth supplies as soon as possible.

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