Manipur's Illegal Highway 'Tax' Takes Consumer Items Out Of People's Reach

The cost of illegal highway 'tax' extorted from truck drivers in Manipur is passed on to consumers in the ethnic violence-hit state, where people in many districts don't get to buy essentials regularly due to supply and logistical problems.

The prices of essentials and other goods have risen between 10 per cent and 30 per cent, depending on the item. Fruit and fish cost 50 per cent more in Manipur, compared to other states.

The illegal 'tax' is paid through a simple but effective method involving middlemen and sometimes hawala transactions, three Manipur-based executives who look after regional distribution of two fast-moving consumer goods (FMCG) companies and a cement major told NDTV, requesting anonymity.

Illegal highway 'tax' collection has been going on in Manipur for decades. Long stretches of the two National Highways in Manipur pass through remote hills, where insurgents and miscreants could easily stop slow-moving trucks and take money from the drivers.

However, the illegal 'tax' becomes exorbitant during a crisis, as is the case now, the three executives told NDTV. The illegal 'tax' is being mostly collected on the roads passing through Kangpokpi, Saparmeina and Motbung, they alleged. Some of these areas saw large-scale violence in the past three months.

"Miscreants are openly collecting illegal taxes from drivers. The average rate is Rs 7,000 per truck per trip. They are taking double of this in areas where violence happened," the executive of an FMCG major that sells baby food and other essentials said, adding there is an understanding among transport companies and the miscreants that they would call the transactions "godown tax".

Before June, transporters paid between Rs 5,000 and Rs 10,000 per truck per trip, while the 'tax' rose to Rs 15,000 to Rs 25,000 after June, the executive said. The total transportation price including cost of diesel for a truck carrying FMCGs was Rs 55,000 to Rs 65,000 per trip earlier. The same is between Rs 80,000 and Rs 90,000 per trip now, which is as costly as transporting cement.

"The money is not paid directly to the miscreants. It is routed through middlemen or hawala, who pass on the collection to the groups after they have taken their cut, which ranges from Rs 2,000 to Rs 5,000 per trip at present," the executive told NDTV.

A hawala system involves two parties transacting money with agents on their behalf without the funds passing through formal banking channels.

The illegal 'tax' is so common it has become a type of highway toll that everybody pays by default, "no questions asked", another executive of an FMCG company that mostly sells biscuits, milk powder and snack food items said.

The major FMCG companies that have distribution networks in Manipur are Nestle India, P&G, Britannia, Parle, and Colgate-Palmolive. Cement companies with a wide sales network in this northeast state are Dalmia Cement (Bharat), Star Cement, and Topcem.

"The extra cost that distributors and wholesalers incurred in paying illegal 'tax' is transferred to the consumers in Manipur, so the sellers are really not at a loss," the cement major's executive told NDTV.

People in Manipur who have faced horrific ethnic violence in the past four months are spending huge amount just to buy necessities. This, at a time when their earnings have fallen as businesses remained shut for over two months since May 3. The situation is worse in the more remote hill areas where access - which was already difficult in normal times - is completely out of bounds for most transporters due to fear of violence.

"The authorities take action now and then, but we feel they aren't capable at the moment due to the ethnic conflict, with the police deployed for law and order duties. The people also don't seem to care as they don't know how exactly the goods are reaching them," the executive said, and explained the cost breakdown of moving cement to Manipur.

A large, heavy-duty truck that can carry 50 tonnes of cement bags charges Rs 1.05 lakh, including cost of diesel. With the maximum illegal 'tax' of Rs 25,000 added, it costs Rs 1.30 lakh to move a single cement truck to Manipur. This pushes up the price of cement up to Rs 800 per bag; the same would cost Rs 450 in other states.

Drivers of fully loaded trucks coming to Manipur from Assam and neighbouring states face the constant threat of landslides and attack by miscreants. They prefer either the Dimapur-Imphal (National Highway 2) or the Jiribam-Imphal (National Highway 37) route.

It takes truck drivers three days to reach the state capital Imphal from Dimapur if there is no landslide on the way. The Jiribam-Imphal route takes much longer, up to 15 days as the road is in a bad condition with huge potholes, broken patches of asphalt, and knee-deep slush and mud for long stretches.

"Drivers have to stay longer on the journey to Manipur due to bad roads. They are not too eager to come to Manipur these days as their expenses are fixed... Some traders in Imphal are also selling products at very high rates citing logistical problems," the FMCG company's executive told NDTV, adding they have been sending baby food, milk powder, household items and snacks through their distribution network to other districts but with great difficulty due to unplanned blockades and protests.

Senior officers of the Manipur Police declined to comment on record when asked about the matter. However, they said they are aware of the problem and are working constantly to curb the illegal practice of taking money from transporters and drivers.

"The curse of geographical isolation has been a factor for the unacceptably high prices of consumer goods in Manipur. The illegal extortion enforced by miscreants and insurgents for decades has now intensified along the highways. This has made the woes of the common people far worse," Lieutenant General Konsam Himalay Singh, PVSM, UYSM, AVSM YSM (retired), told NDTV.

"I call upon all those who are responsible, including state and central agencies, to take immediate measures to solve this crisis," said Lt General Singh, who was honoured with the Yudh Seva Medal after the Kargil War in 1999, when he commanded the 27th Battalion, Rajput Regiment, in the high-altitude battlefield Siachen. He was also the first officer from the northeast to become a Lieutenant General in the Indian Army.