Kathmandu, July 3

If everything goes according to plan, the garment processing zone (GPZ) within Simara Special Economic Zone (SEZ) will be operationalised within the next fiscal year.

According to SEZ Development Authority Nepal, construction works of GPZ is going on in full swing and is expected to becompleted within next six to seven months.

“Currently, we are engaged in construction of necessary buildings, roads, compound walls and drainage, among other physical infrastructure of GPZ inside the Simara SEZ. Similarly, works regarding plotting of available land for GPZ will be completed soon,” informed Chandika Bhatta, executive director of SEZ Development Authority Nepal, adding that the GPZ should be able to commence operation within the end of next fiscal year.

However, Bhatta said that collaborative efforts from all government authorities involved in developing the Simara SEZ is crucial to operationalise the GPZ at the earliest.

The concept of the GPZ was born after the United States extended zero tariff preference for 66 products, including apparels, into its market through ‘Trade Facilitation and Trade Enforcement Act’ since February 2016. Construction of GPZ is expected to bring down the production and export costs of Nepal, which is relatively higher when compared with other nations in the South Asia region.

The planned GPZ in Simara SEZ will house 69 blocks for garment industries. All of these blocks will be equipped with necessary facilities, including power, road connectivity, water supply and sanitation, among others.

The cost of constructing GPZ is estimated at around Rs 2.5 billion.

Apart from reducing the cost of production and export, the GPZ is also expected to slash the high transport and shipment costs incurred by Nepali garment traders due to Nepal’s landlocked status, as the proposed GPZ is located near the country’s only rail-linked dry port in Birgunj.