Nepal : Hindus believe the rudraksha, the dried seeds of the Elaeocarpus ganitrus tree that grows in the foothills of the Himalayas, are made from the tears of Lord Shiva and hold them sacred. While there is no such story in Buddhism, the depiction of the Buddha, like many sacred figures in the region, wearing rudraksha beads has made them special to Buddhists as well. Nepali traders used to largely sell the seeds to Hindus in India, but this has changed in recent years.

For 27-year-old Nima Tamang, the seeds mean business with the Chinese. “I sold 10,000 kilograms of seeds to the Chinese in 2020,” he says, up from a previous yearly average of 2,000-3,000 kg, earning 3.5 million NPR (Rs 21.71 lakh).

Since 2014, Nepali farmers and traders have capitalised on Chinese demand for rudraksha and bodhichitta seeds, which Buddhists use as prayer beads The market for both products is a microcosm of the overall trade dynamics between the two countries, in which Nepal exports raw materials and has little leverage over trade mechanisms.

Deepening bilateral ties in the past decade meant Chinese buyers could purchase the seeds directly from farmers and middlemen like Tamang. But Tamang’s financial success in 2020 was not to last: Chinese travel restrictions to stop the spread of Covid-19 resulted in a sharp drop in demand and prices, leading to Nepali farmers and traders suffering massive losses. Nepal’s lack of policy focused on such trade has meant there is not much sellers can do but wait for the Chinese buyers to return.

The overall trade balance between the two countries skews heavily in favour of China. Nepal imported  211 billion NPR, or NPR (Rs 13,183 crore), from China between mid-July 2021 and mid-April 2022, according to Nepal’s Department of Customs. In contrast, Nepal’s exports to China were NPR 622 million (Rs 38.77 crore) in this period.

Nepal’s main exports to China are carpets, medicinal plants, hand-drawn paintings and sculptures. Rudraksha seeds were the 10th most valuable export category in the 2020-21 fiscal year, with the country exporting 280,874 kg.

“Nepali farmers started selling rudraksha seeds to the Chinese around 2013-2014,” says Tamang. Chinese demand changed the fates of rudraksha farmers in Sankhuwasabha and Bhojpur districts in eastern Nepal, where the seeds are sourced, and of middlemen like Tamang who can speak Mandarin.

Tamang says: “The Chinese paid high prices for rudraksha seeds – even up to NPR 1-1.5 million (Rs 6.2-9.3 lakh) per kilogram at times. Seeing the profits, I jumped into the business about three years ago as I was already a Chinese language guide.”

While India is a major market for the seeds, Chinese buyers dominate and set the prices because of they offer higher rates for more common varieties.

The rudraksha market is primarily an informal cash business, and thus actual export figures may be far higher than those captured by government reporting. The variation in pricing for rare rudraksha seeds compared with average ones, which only sell for about NPR 100 (Rs 62) per kg, adds to the complexity.

The trade in bodhichitta and rudraksha seeds is not currently governed by any formal policies except for the payment of forest levies and municipal taxes. Sellers believe Nepal needs to create policies to control prices and formalise the trade so that it does not lose out on revenue.

But official neglect of the sector, which might have allowed sellers to pocket untaxed income, has other consequences.