Kathmandu-Panchakanya Group plans to move its stainless steel tank industry out of the Bhairahawa Special Economic Zone after India blocked imports from Nepal.
Panchakanya SS Export, which entered the zone in 2021 to produce for export, has asked the SEZ Authority for permission to leave. The company has not shipped any products for several months.
Executive director Ujwal Shrestha said India now requires Bureau of Indian Standards certification for all steel products. The company has not secured the documents for raw materials or finished goods. He said exports stopped because the firm cannot meet the new Indian rules.
SEZ law requires firms to export to continue operating inside the zone. Shrestha said the company cannot export to India under the current conditions, so it decided to relocate.
The company earlier exported three to four truckloads of stainless steel tanks each month. Annual exports were worth about Rs 20 million. Shipments stopped after Nepal lost its place in the Steel Import Monitoring System and India tightened BIS requirements.
After nearly four years inside the zone, the company said it cannot rely on the domestic market.
SEZ rules allow domestic sales only during the first three years. Firms must export at least 30 percent of total production in the fourth year. The company has not met this target.
Panchakanya Group said it will continue operations. It plans to shift production outside the zone but remain in the Bhairahawa area. Once the SEZ Authority approves the request, the company will formally exit the zone.
