Talks held by the People’s Republic of China (PRC) and the government of India in the Indian capital New Delhi in July 2004 have failed to bring about a general normalisation on the Indo-Tibetan border. Meanwhile, despite some setbacks, unofficial border trade continues, leading the revenue department of the Indian finance ministry to plan the opening of a Land Custom Station (LCS) in Ladakh, Jammu and Kashmir, a region with close cultural affinities to Tibet, and situated beyond the western border of the Tibet Autonomous Region (TAR). The Commissioner of Customs has proposed to open the station in the Loma area of Nyoma block of Leh district and land for the project has already been identified.
The establishment of a custom station in Ladakh was first proposed in 1962 at Kuyul in accordance with the Customs Act of 1962, however, it never came into being due to the outbreak of the Sino-Indian border conflict in the same year. The opening of the new LCS in Ladakh would be the fourth along the Indo-Tibetan border, with one at Shipkila in Kinnaur, Himachal Pradesh, and another at Gunji, Uttaranchal. A third one is due to open in the Nathu La area of Sikkim that was proposed following the Sino-Indian agreement to re-open this sector of the border during the visit of the then Indian Prime Minister Vajpayee’s to Beijing in June 2003. However, the actual terms of the agreement, and the opening of the border, remains to be implemented. The most recent talks between the Indian and the Chinese governments do not appear to have brought a breakthrough regarding the details of any future cross-border contacts.
Meanwhile, smuggling of goods across the border region continued when traditional trade routes were closed for free trading and check posts where set up. Dumtsele, a border point in the TAR next to the Skakjung pasture, a winter pasture for nomads, is the main point where the exchange of goods takes place. Large-scale traders coming from Lhasa or Chinese cities put up temporary stalls at Dumstele, and some influential local nomad families also engage freely in trading.
According to a Ladakh resident who was once involved in smuggling, the trade on the PRC side is free unlike on the Indian side. He was once caught by the Indo-Tibetan Border Police, who confiscated goods worth IRS40,000 (UK£485.00; US$865.00; EUR714.00). He also suffered losses when Chinese pillows worth IRS150,000 (UK£1,818.00; US$3,243.00 EUR2,676.00) 
that were being transported in an open truck were spoilt due to rain on the way to lower regions of India. This led him to stop his risky business.
However, smuggling still continues, although it has decreased considerably. This is apparently due to the establishment of a Customs Preventive Station (CPS) office in Nyoma block in 2002 and the outbreak of SARS in 2003. The medical department in Leh, the capital of Ladakh, ran a campaign at that time warning people on the border of the spread of the disease in the PRC and implicitly suggesting that travel across the border placed them at risk.
In Leh city, at the Moti market, goods smuggled from China are openly sold, some goods such as Thermos flasks, blankets, shoes, crockery, electronic devices, velvet, carpets, cigarettes etc. but because of restrictions, there is a relative shortage of these products compared to what there was in the past. Other items brought in from across the border to Leh are pashmina wool, silk and shahtoosh, shawls made from the fleece of the endangered Tibetan antelope (chiru). The trade in this internationally prohibited product is said to be the most profitable of all smuggling activities. Sources said smuggling takes place more often in winter, and goods are carried both by motor vehicles and on horseback. Smugglers travel at night to avoid police and army patrols. Sources also confirmed that some 5,000 sheep and goats are smuggled annually from Tibet to meet the demand for meat in the Leh area.
Apart from the local commerce, smuggled items from the PRC also make their way to Srinagar, the capital of Jammu and Kashmir, or the states of Himachal Pradesh and even the Punjab. Recently, a conflict occurred in the Skakjung area. Some Indo-Tibetan Border Police officers raided the nomads’ camps and harassed the families there. Angry nomads retaliated by throwing stones at them and later held several protest rallies, resulting in the regional authorities visiting the area. A meeting was held at the Ladakh Autonomous Hill Development Council’s (LAHDC) premises in Leh. (The LAHDC is the organ of local self-administration.) During the discussions to resolve the matter, the nomads admitted that many of them are involved in smuggling goods across the border, but protested against the frequent harassment of innocent people by the border police. They demanded either a complete ban on smuggling or the opening of the route for regulated trading. They alleged that the Indo-Tibetan Border Police and intelligence agencies tolerate smuggling in order to gather information from the locals.
With the opening of the custom station, many of the smuggled items could be legally exchanged on the border for the benefit of the populations on both sides. Additional items in demand on the Indian side include: wool, goat and ship skins, yak tails, goats and sheep, yak hair, horses, salt, borax, szaibelyite, China clay, buttons and silk. Pashmina is also considered to be a potential import item. The list of goods to make their way from India into the PRC is even longer: agricultural implements, blankets, clothes, textiles, cycles, copper products, coffee, tea, barley, rice, flour, dry fruits, dry and fresh vegetables, vegetable oil, gur and misri, (sugar products,) tobacco, snuff, cigarettes, canned food, agricultural chemicals, local herbs, dyes, spices, watches, shoes, kerosene, stationery, utensils and wheat.
However, the way towards an opening of the border appears long and stony. Whereas many in India increasingly demand it, particularly tourism agencies operating in Ladakh, with the prospect of easy and profitable access to Mount Kailash, one of the Hindu’s favourite pilgrimage, the PRC tourism industry, which has not yet established a viable infrastructure in West Tibet, fears to lose potential customers to Indian competitors. Both the Indian and the Chinese military have also both expressed strong reservations about making what they regard as strategic routes accessible to civilians, traders or tourists. In India, tourist operators serving the border crossing points of Shipkila and Gunji are afraid of losing their monopoly over the passes to Kailash to the longer but much easier route via Ladakh. Finally, according to a highly placed source in India, reservations within the central administration exist, that the opening of the border would benefit more Tibetans living in India rather than locals, since Tibetans involved in the trans-border trade are perceived as having the advantage of knowing the locality and people across the border.
