Nepal | April 03, 2020

Birgunj traders relocating business

Pushpa Raj Acharya
Birgunj dry port

Stranded containers being loaded at the dry port in Birgunj, amid the unofficial blockade imposed by India at the border point, on Thursay, October 29, 2015. Photo: Ram Sarraf

Kathmandu, January 12

Traders based in Birgunj have started relocating their businesses to Biratnagar, Bhairahawa, Narayangarh and other bordering towns, as the protests that have continued for almost five months have severely affected business activities in the vicinity of the city known as gateway to Kathmandu.

One fallout of this has been culling of thousands of jobs, hitting daily wage earners the most.

Over 500 out of 1,500 enterprises involved in wholesale and retail trading have so far shifted from Birgunj, according to Subodh Gupta, vice president of Birgunj Chamber of Commerce and Industry.

According to him, a retail trader needs to pay Rs 30,000 a month as rent for a shutter shop to operate business in Birgunj.

It is reported that there are around 1,000 enterprises involved in retail trade and over 500 in wholesale trading business.

“Industrialists in Bara-Parsa corridor are also waiting and watching. If the situation prolongs, they too will start relocating their factories.”

Small and medium enterprises and industries along the Bara-Parsa industrial corridor were employing 200,000 individuals till August, as per the data maintained by BCCI.

Birgunj used to be a lucrative location to run trading business and Bara-Parsa corridor was ideal for setting up factories.

This was because trade through Birgunj route accounted for 61 per cent of the total trade during normal times, as per a study conducted by the United Nations Economic and Social Commission for Asia and the Pacific.

The cost of transportation of Nepal-bound cargo from Kolkata port to Birgunj is significantly lower than other border points.

As the Madhes-based agitating parties had started their protest programmes (which at times turned violent) a month before they launched the blockade at Birgunj crossing, all economic activities have been disrupted there since August.

Gupta warned that Birgunj which used to be a thriving and vibrant business hub not too long ago will turn into a dead city if the current situation did not improve because all the other border points are peaceful.

“And once the industrialists and entrepreneurs relocate their factories and businesses, it would be very difficult to bring them back.”

“Losses faced by entrepreneurs in Birgunj are extensively higher than from other areas as this area has been most affected due to the agitation and the border blockade,” said Gupta.

The prolonged protest and the blockade at Birgunj border crossing have hit hard the employees and daily wage earners.

Industrialists are said to have started the process of laying off workers from factories since the start of the blockade to minimise their operation costs.

In the beginning, workers were put on forced leave with permission of District Labour Office.

However, as the office can only extend the approval to send workers on forced leave for a maximum of 15 days in a year, industrialists and entrepreneurs have already approached the Department of Labour to implement job cuts.


A version of this article appears in print on January 13, 2016 of The Himalayan Times.


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