Kathmandu “Post” reported that the Nepal government’s assessment team recommended the closure of Biratnagar Jute Mill and Butwal Textile Mill.
These two factories were closed a few months ago, and the government owns 47% and 56% of the shares respectively. The assessment panel also recommended temporarily laying off workers until the government makes a final decision. These two factories have lost their market competitiveness due to outdated equipment, high operating costs, and power shortages. According to reports, due to the implementation of the minimum wage standard system, the daily wage of Nepali workers is 190 rupees, which is higher than the Indian standard of 123 rupees. This move will greatly weaken the competitiveness of Nepali enterprises unless more advanced production equipment is used to increase productivity.
About 720 million rupees will be needed to restart the two factories.
