Indian fast-moving consumer goods (FMCG) companies have suspended their operations in Nepal due to the escalating civil unrest and violent youth-led protests in the country. Britannia Industries, a biscuit and bakery products maker, has indefinitely suspended all manufacturing operations at its Simara plant in Bara district, citing the safety of its employees as the top priority. The plant, which was set up in 2017, has an annual capacity of 14,000 tonnes of biscuits and bakery items and employs about 350 workers.
Other FMCG companies, such as Bikaji Foods International and Dabur, have also been affected by the unrest. Bikaji Foods, which signed a joint venture deal with Nepal’s Chaudhary Group in July, expects the project to be delayed due to the current situation. Dabur, which has a subsidiary in Nepal, has asked its employees in Kathmandu to work from home and has advised its sales teams to prioritize safety and adhere to local curfew directives.
The suspension of operations by Indian FMCG companies is expected to have a significant impact on Nepal’s food processing sector and local consumers. Close to a dozen Indian companies have operations in Nepal, spanning packaged goods and hospitality sectors, and the closure of plants and disruption in supply chains are likely to trigger uncertainty and strain businesses operating in the country. Nepal contributes about 3% to Dabur’s consolidated sales, while Britannia Nepal generates annual revenue of ₹170-180 crore.
The ongoing unrest in Nepal is causing concern among Indian businesses operating in the country, and many are closely monitoring the situation. The shutdown of local supply markets amid the continuing unrest in Kathmandu and other cities is expected to further strain businesses operating in the country. As the situation continues to evolve, Indian FMCG companies are taking a cautious approach and prioritizing the safety of their employees and operations.