Traditional trading routes connecting India with the Silk Road have flourished in past decades, with the tacit approval of both armies. But the stand-off means these traders are unable to cross the border, putting their livelihoods at risk in the profitable winter season.
Unlike previous years, the arrival of winter does not bring much hope to Gyalson, a trader in Demchok, one of the last Indian villages before the border with China in the Ladakh region.
Life can be hard in this mountainous, high-altitude territory, where temperatures can fall up to minus 40 degrees Celsius. But for traders like Gyalson, 47, winter means business. Heavy snowfall and landslides cut the connectivity between villages and the regional capital Leh, around 300km to the west, meaning people are forced to look eastward to China.
Around half a century has passed since India and China sealed their border, and even fought a war, but in Ladakh the tracks connecting the region to the historical Silk Route did not shut down. This allowed trade between these border villages to flourish.
Once the mighty Indus river flowing near his village freezes over, Gyalson normally takes his pack animals and crosses into China laden with goods such as dried fruits, wheat flour, spices, raw wool and rice. For months, he has been feeding up his yaks and horses to prepare them for the journey.
“It takes me a day to take goods to the other side, near a place called Dumchelle, where traders gather with their goods. It is a market where we barter with the Chinese,” said Gyalson, who only wanted to be identified by his last name. “We then load the animals again and come back in the night to our village.”
In exchange for his goods, Gyalson gets shoes, carpets, blankets, clothes, crockery and electronic appliances.
“During the summers we gather the goods from all over Ladakh, which we sell to the Chinese in winters. In return we bring Chinese goods and sell to the retailers in Leh city,” the second-generation trader said.
For many in Ladakh, this is the only way to eke out a living, and these exchanges have happened for decades without interruption.
But this year everything changed. The armies of India and China are locked in a fluctuating stand-off. The tension had been brewing for the past three years, and eventually culminated with a violent confrontation in June in which at least 20 Indian soldiers were killed. This was followed by an escalation in troop and arms deployments on both sides.
Winter has already set in but the dispute has dashed the hopes of Indian traders.
“We have been clearly directed by the troops to stay away from the border, and no informal trade will be allowed,” said another trader, Dorjay, 38.
“In the winter season, I would earn around half a million Indian rupees (US$6,700) and it would be sufficient for me to take care of my family for a year,” he said.
Tashi Chhepal, a decorated former Indian army officer who served in eastern Ladakh, recalled how trade was conducted with the tacit approval of both armies.
“We could see traders from our side crossing to the other side, and Chinese traders would come to our side. Stalls would be set up and it would be a bustling market,” said Chhepal, who regularly bought Chinese goods like rugs and vacuum flasks at such markets.
Over the years, the trade grew so much that Chinese merchants would ferry goods to the border in trucks. At times, temporary bridges were made and the exchanges would extend beyond the winter.
Since the tensions escalated on the border, life has become difficult for us
This trade was our livelihood, Informal trader Gyalson. The Chinese goods brought added value to markets in Ladakh towns. “Tourists coming here would buy this stuff as they would get it at a comparatively cheaper price,” said Gyalson.
Locals said that for years, the armies on both sides would meet and decide dates for a trade fair during summers in Dumchelle.
Romesh Bhattacharji, a former trade customs officer in Ladakh, described the cross-border trade as a “very well organised” and “huge” business.
Bhattacharji believes the Chinese have always had an upper hand. “They would at times come to our villages and roam freely.”
The former officer cites an instance when a trader in a village named Koyal got into a feud with a Chinese merchant. “One day the Chinese trader came with his men to Koyal and raided the trader’s house seeking money. They only left after he was able to get cash from a bank.”
There have been numerous accounts suggesting that the Chinese would accept Indian money in the exchanges and that authorities on the Indian side would use the informal traders to gather information.
“Different top officials told me that they allow these traders because they also pass on information about the Chinese side,” said Bhattacharji. “I am sure that the trade was used as a means by intelligence agencies of both countries to snoop on one another.”
Locals say government officials also benefited. “The [local officers] as well as army would get their share of the trade,” Dorjay said.
The informal traders say they asked the Indian government to formalise these interactions, and by last year the two countries were close to signing an agreement to this effect. The Indian Army had even approved the opening of a trading point with China at Dumchelle, which was seen as a confidence building measure ahead of Chinese President Xi Jinping’s visit to India in October 2019.
A Hindustan Times report suggested that work on a road and customs checkpoint had also been started, but the army was waiting for approval from the Indian parliamentary panel on security.
However, the border stand-off has brought any progress on this to a halt. India accused China of grabbing land in Ladakh and of regular incursions. Dumchelle, where traders would meet and exchange goods, was on the Indian side, according to former officer Chhepal, but today is under Chinese control.
“Since the tensions escalated on the border, life has become difficult for us. This trade was our livelihood,” said Gyalson, who has already started looking for other job options even as the demand for cheaper Chinese goods remains strong.
Some traders are trying to exploit the situation by defying the rules of the market and buying inferior Chinese-labelled products from Indian cities and passing them on as smuggled goods. “But the quality is unmatchable and it is not going to work,” Gyalson said.