Nepal Yarn industry gets 60 percent boost due to increase in demand from India

Nepal’s yarn industry has recently witnessed a surge in demands that has increased the business operations for the local handloom producers up to 60 percent, news agency ANI’s report confirmed. Producers have attributed the business bloom to the increasing orders coming from India after the phased reopening and resumption of economic activities post coronavirus lockdown.

The Government of India, under the India-Nepal Foreign Treaty of Trade Agreement imports woven handicrafts and home textile products essential to Nepal’s Textile And Garment Cloth Industries. Nepal’s GDP and livelihood of the small scale textile weaving businesses largely depend on these handicrafts exports.

"We are now exporting the yarns to India. My company, in particular, is running at 70 percent of the capacity, other companies also are following the same steps," ANI quoted a Nepali proprietor Bishnu Neupane of Jagdamba Spinning as saying. "We are receiving high demands and orders from India," he stressed.

Indian states of Punjab and Assam, and Siliguri, Guhawati, Gorakhpur, and New Delhi have been among the largest importers of Nepal’s yarn industry products for over several years. These states place bulk orders that comprise nearly 60 percent of Nepal’s total yarn manufactured goods export. 

Read: Nepal Landslide: Police And Security Forces Start Search Operation, 11 Killed

Read: Nepal Urges SAARC Nations To Convene 19th Summit Soon; To Collectively Fight Coronavirus Pandemic

"We had to halt production due to the lockdown in India and Nepal, but now we are back to business employing 17 hundred workers with food and accommodation provided by the company," a proprietor of Reliance Spinning, Shashikanta Agrawal, was quoted by ANI. 

"As we are receiving the orders, our business is slowly getting back on track,” he added.

Turkey had suspended GSP benefit

After India, Turkey is the second-largest importer of yarn from Nepal. Turkey, however, suspended the generalized system of preferences (GSP) benefit on Nepal's yarn handicraft products in 2018 in the wake of allegations that Nepal was using the Chinese yarn material to manufacture the exported goods.

Later, representatives from Turkey's Yarn Producers’ Association ended the import barriers after Nepal provided information on the production units, the production capacity of the spinning mills, employment, and taxes to the directorate general of customs enforcement in Turkey, according to Nepal’s state-run media sources.

India, meanwhile, imported Nepali yarns worth close to one billion Nepali rupees pushing some of the key players like Reliance Spinning, Triveni Spinning, and Jagdamba Spinning to operate over 60 percent capacity. 

Read: Nepal Citizens Protest At China's Kathmandu Embassy After Spotting Land-grab Backstabbing

Read: Nepal PM Oli Pushes India-proposed Convention On International Terrorism (CCIT) At UNGA