Nepal’s steel exports to India have come to a standstill in recent months after the Indian government imposed a ban, dealing a major blow to Nepal’s steel industry. Industries operating in Special Economic Zones (SEZs) have been particularly affected, with industrialists facing growing uncertainty as India—Nepal’s primary export market—has blocked customs clearance under a mandatory export regime.
Rupak Garg, manager at Vistaar Global Pvt Ltd, located in the Bhairahawa SEZ, said Nepal has been removed from India’s ‘Steel Import Management System’ (SIMS)—the platform required for steel exports to India. “When we try to fill out the form in SIMS, Nepal is no longer listed as an option,” Garg said. Vistaar Global, which employed 300 to 400 workers, has seen its products pile up in warehouses for the past month, with 90 percent of its stainless steel utensils previously exported to India.
Accounts Officer Arvind Tripathi said the company has exported utensils worth over Rs 720m in the current fiscal year. He urged the government to intervene urgently to resolve the issue.
The Panchakanya Group, which manufactures drinking water tanks within the SEZ, has also been hit. Its exports to India have been halted. “We established our factory in the SEZ expecting streamlined services, but with exports blocked, we are now facing serious difficulties,” said Devendra Sahu, General Manager of Panchakanya. “If this situation continues, we may be forced to shut down operations in the SEZ.”
Previously, India required Bureau of Indian Standards (BIS) certification only for finished products. Vistaar Global had acquired the BIS certification, but Panchakanya had not. However, India did not previously require BIS certification for stainless steel drinking water tanks due to the lack of a specific BIS standard.
Nepali industrialists suspect India removed Nepal from SIMS over the absence of BIS certification for raw materials.
Netra Prasad Acharya, President of the Siddhartha Chamber of Commerce and Industry, called the decision a serious blow to Nepal’s steel sector. Sagar Silwal, Senior Assistant for Information Technology at the SEZ Authority, confirmed the matter has been reported to the Ministry of Industry. He emphasized the need for coordinated action involving the Ministry of Industry, Ministry of Foreign Affairs, and the Indian Embassy.
