Small industries face challenging times

Kathmandu, January 6

Sabitri Shrestha, 40, who resides in Balaju and had been making candles for the last seven years, had to shut her cottage industry one-and-a-half months ago due to scarcity of wax, for which the country is reliant on India.

Shrestha started facing shortage of the raw material immediately after the border blockade started.

The dry season is the peak time for sales of candles as the load-shedding hours go up. However, the scarcity of wax dampened her business this year. Apart from Shrestha, two others were employed in her candle production business.

Tanka Maharjan, who operates Tanka Metal in Kuleshwor, was at the Cottage and Small Industry Office, Kathmandu, seeking a recommendation letter to purchase diesel so that he could run his generator to keep his factory in operation.

He did receive the recommendation letter but was apprehensive about whether he would be able to get diesel from the authorised fuel stations of Nepal Oil Corporation.

“We have been providing recommendation letters for diesel to such industries, but they are in the least priority because there is a long list of priority sectors set by the Ministry of Supplies,” said Narayan Acharya, chief of the Cottage and Small Industry Office, Kathmandu.

Acharya said after the border blockade, the number of registered industries at the Kathmandu office has dropped.

As compared to the registration figures of the first five months of the previous fiscal, the number of registered industries has declined this year and the number of industries being shut down has risen.

In this fiscal, registration of tailoring firms, consultancy offices and construction companies has increased. In the last fiscal, tailoring had not received the recognition of industry.

The number of consultancy firms and construction companies has increased, as engineers have started registering companies eyeing the massive reconstruction drive in the country, which is about to kick off through National Authority for Reconstruction.

Despite that, only 1,077 companies were registered in the first five months of this fiscal at the Kathmandu office as against 1,419 companies in the previous fiscal. According to CSIO, 81 companies were shut down in the first five months of this fiscal as compared to 62 in the corresponding period of last fiscal.

“Cottage, small and medium industries are on the verge of collapse with the prolonged scarcity of raw materials and fuel in the country,” said Yam Kumari Khatiwada, joint secretary at the Ministry of Industry.

Khatiwada, who looks after the Industrial Promotion Division at the ministry, said that would have a long-lasting adverse impact on the economy because cottage and small and medium businesses are considered as the spine of the economy.

According to data obtained from the Federation of Nepal Cottage and Small Industries, a total of 162,110 cottage and small industries are in operation across the country from among the 281,723 registered firms.

About 40,000 small and cottage industries have shut down since the earthquake last year.

The 162,110 industries in operation have generated employment for 2.14 million individuals in the country.