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August 19, 2017

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In today's fuel-starved Nepal, re-filling the tank costs a day

KATHMANDU -- The three men standing by their cars as night fell peered into the little white taxi, and recognizing the Nepali cab driver as a friend, hissed, "Need petrol? We know where you can get some."

The driver slowed, and said he would return later for the few liters of black market petrol that would save him from losing an entire day queuing.

How to get hold of petrol is one of the hottest topics in Nepal ever since its sole supplier, India, began refusing to sell fuel on credit a year ago to Nepal's state-run fuel monopoly, which owes it millions of dollars. The ensuing shortage has led to rationing and pump queues of several kilometers.

"I parked the truck in this line at 7:00 pm yesterday," said food transporter Krishna Bahadur Shrestha, 40, who was number 56 in a queue for diesel.

"They will only give me 10 or 15 liters. I won't be able to run my truck for even a full day on that."

In recent months — despite a hike in government-set prices in June — the supply has shrunk even more as rising crude costs that India passes on to Nepal have further limited how much the landlocked Himalayan country can buy in cash.

But the Nepali government continues to subsidize pump prices for fear of widespread protests in the country, still navigating a two-year-old peace process that saw Maoist rebels lay down their arms after a decade of war. The policy has led the Nepal Oil Corporation into a sink-hole of almost 230 million dollars of debt — and counting.

In July it was only able to import half what it needed, which it sold at a loss of 11 million dollars. Most of that was from diesel, which sells at a loss of 40 US cents a liter.

"Our purchasing price is higher than our selling price," said Mukunda Prasad Dhungel, deputy director of Nepal Oil Corporation's fuel supply and distribution department.

"The price is fixed by government. We can't do much," he said, adding the government needs to overhaul its fuel policy.

Maoist leader Prachanda, sworn in this month as the country's new prime minister following the abolition of Nepal's monarchy, has promised to tackle food and fuel shortages gripping impoverished Nepal — but has not said how.

Meanwhile, Nepali workers devote multiple hours — or even days — each week to filling up. Drivers jostle to keep their spots every time the queue edges forward, while enterprising snack and water sellers flock to the lines and the captive customers.

Where possible, Nepalis try to keep their ears open for anyone who might be stockpiling some fuel to sell on the black market.

"One week ago I waited in the queue to refill the tank but when my turn came the gas station ran out of petrol. I wasted six hours of waiting," said taxi driver Bir Bahadur Lama, 48.

He eventually bought five liters from a bus driver who picked up extra fuel on a trip south to the region bordering India.

"Life is getting miserable," said Lama, who earns 103 dollars a month but owes almost twice that in monthly payments on the new taxi he bought last year.

Recently he has had to borrow from friends and family to make the payments, racking up a hefty debt.

"I think I put my money in the wrong place," said a morose Lama. "I spend more time queuing up at gas stations than waiting for customers."

Even those who don't depend directly on fuel for livelihood are suffering.

Food prices have gone up 20-30 percent in recent months, according to the UN's World Food Program, because farmers have had to pay more to run tractors and transporters charge more to get food to markets.

"This subsidy is destroying the country," said Shiva Prasad Ghimire, president of Nepal's petroleum dealers association, which wants the government to raise prices again.

"All the development money, the money for roads, for drinking water is all going into the Nepal Oil Corporation's losses."

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