Special Economic Zone has not been able to achieve success


Butwal : Bhairahawa of Rupandehi The Special Economic Zone (SEZ), which was established five years ago, has not achieved the expected success.

The government’s objective has not been achieved as the SEZ located in Rohini Gaonpalika-1 Bagaha of the district with the objective of reducing trade deficit by increasing exports has not been successful. According to the Special Economic Zone (SEZ) Bhairahawa, some industries have been exporting for four years in the SEZ, which operates six industries, but there are only two industries exporting 60 percent of the production.

The SEZ premises are currently being manufactured by Brilliant LED, Shakti Mineral, Vistar Company, Panchakanya Udyog, Jayabuddha and S Polymer and Tirupati Metal is also in operation. Of the three industries that have been exporting since 2076 BS, Brilliant exported 58 percent, Shakti Mineral 24 percent and Vistar 100 percent in the fiscal year 2076-77.

Similarly, in the fiscal year 2077/78, Brilliant exported 24 percent, Shakti 2.5 percent, Vistar 99 percent and Panchakanya only 2 percent, according to the Special Economic Zone (SEZ). Chandika Bhatta, executive director of the Special Economic Zone (SEZ), said the state should cut production costs from SEZ industries, adding that the export threshold was not effective.

“We have not been able to achieve the expected success due to weak state policy,” he said. Director Bhatta urged to make the products from Nepal industry friendly by amending the Act as it is uncomfortable to compete in the foreign market.

As of December of the current Fiscal Year 2078/79, Brilliant has exported 48 percent, Shakti 12 percent, Vistara 87 percent and Panchakanya only 1 percent. Currently Jayabuddha and S Polymer are also producing. According to Bhatta, the industry will be able to sell its products within Nepal even if there is no mandatory export in the first year.

A special economic zone has been set up to encourage the industry to produce goods that are in high demand in foreign countries even though they are sick in the country and produced in Nepali market. Initially, the provision was to export 75 percent of the production, but now it has been reduced to 60 percent.

In the special economic zone, there are 17 types of industries including food and agro-industries, herbal products, leather goods, readymade garments, carpets and woolen goods, pashmina and silk, handicraft products which are not affected by the environment.

Nira Bhattarai of Bhairahawa Special Economic Zone informed that work is underway to expedite the export of SEZ from Belahiya near the customs office without any delay. In Bhairahawa, the government started land acquisition in 2001 to set up an export promotion center. SEZ construction was started in Bhairahawa in 2008 with the introduction of SEZ Ordinance in 2005.

Although the SEZ Bill was introduced in the Parliament in 2008, the Act was passed only in 2016. Although the government announced in 2010 through the industrial policy to provide income tax, VAT, customs and other exemptions and facilities to the industry in the SEZ, the industrialists are not considering going to the SEZ.

There are industries operating in special economic zones, especially those that do not affect the environment. In particular, 17 types of industries including food industry and agricultural industry, herbal products, leather goods, readymade garments, carpets and woolen goods, pashmina and silk, handicraft items will be in SEZ. There are 68 plots in the SEZ spread over 52 bighas.

By Auther