Kathmandu, December 1

Industries and businesses, badly affected due to the blockade at border points with India and prolonged protest in Tarai, have started laying off their staff in a bid to bring down their losses.

“Protest in Tarai since last three-and-a-half months and blockade at the border points since last two months have forced industries and businesses in Tarai to close their shutters, said Pashupati Murarka, president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI). “The financial toll on industries and business due to the protest and blockade has already surpassed the economic losses incurred due to the devastating earthquakes of April and May.”

Prolonged protest in Tarai has deprived the daily wage earners from earning money and hit the low income family due to rising inflation, as per Murarka. In this backdrop, he also requested the government to ease the rules for industries and businesses citing the rigid legal provisions to lay off staff and close down the company during such challenging situations.

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Speaking during a programme organised by Society of Economic Journalists-Nepal (SEJON) to mark its 18th annual day, Murarka said private sector has been bearing unimaginable losses and is in critical stage.

In the programme, Nepal Rastra Bank Governor Chiranjibi Nepal expressed serious concerns over the growing parallel economy, which in turn has started to squeeze the formal economy. Black-marketing of fuel and daily essentials has flourished in the country along with disruptions in supply lines from India to Nepal.

The task of controlling inflation to a single digit would be challenging if the government cannot streamline the supply at the earliest, according to the governor.

He also expressed anxiety over the growing frustration in private sector and highlighted the risk that economy could be pushed towards depression due to the frustrations of private sector.

Meanwhile, Minister for Finance Bishnu Paudel said the blockade is a temporary phenomenon and the government has been putting its best effort to resolve the crisis through the dialogue with agitating Madhes-based parties.