FNCCI urges government to take diplomatic action as Indian restrictions disrupt Nepal tea exports

KATHMANDU: The Federation of Nepalese Chambers of Commerce and Industry has called on the Government of Nepal to take immediate diplomatic initiatives to resolve growing obstacles affecting Nepal’s tea exports to India, warning that the issue is threatening the livelihoods of thousands of farmers, workers, and tea entrepreneurs.

In a press statement issued on Wednesday, FNCCI urged the Ministry of Industry, Commerce and Supplies to prioritize the matter and engage with Indian authorities to find a swift and sustainable solution.

“Given that this sensitive issue is directly linked to the future of thousands of tea farmers, laborers, and entrepreneurs, the government should treat it as a high-priority matter and pursue an immediate diplomatic resolution,” the federation said.

New Indian Rules Create Export Bottlenecks

According to FNCCI, Nepal’s tea exports have faced significant disruptions since May 1, when the Tea Board India implemented a new Standard Operating Procedure (SOP) and mandatory testing requirements for every tea consignment entering India.

Industry stakeholders say the new measures have slowed cross-border shipments and increased compliance costs, creating uncertainty for exporters and tea producers in eastern Nepal, where tea cultivation is a major economic activity.

The impact has become severe enough that tea factories in several production areas reportedly suspended operations from June 15 (Asar 1) due to difficulties in moving products to their primary export market.

Thousands of Jobs and Livelihoods at Risk

Tea is one of Nepal’s most important high-value agricultural export commodities and supports thousands of smallholder farmers, plantation workers, processors, transport operators, and exporters.

Industry leaders warn that prolonged export disruptions could result in financial losses across the supply chain, particularly during the peak harvesting and processing season.

Nepal exports a significant portion of its orthodox and specialty tea production to India, which also serves as a gateway to other international markets.

Business leaders fear that if the situation remains unresolved, Nepal’s tea sector could face declining production, reduced income for growers, and increased pressure on rural economies dependent on tea cultivation.

Call for Accredited Testing Laboratory

FNCCI also highlighted the need for Nepal to strengthen its domestic quality-certification infrastructure.

The federation said establishing an internationally accredited laboratory in Nepal would help address quality-related concerns raised by importing countries and reduce reliance on external testing mechanisms.

According to the federation, a recognized testing facility would improve export competitiveness, speed up certification processes, and help ensure compliance with international standards for tea exports.

Strategic Importance of Nepal’s Tea Industry

Nepal’s tea industry has gained international recognition in recent years, particularly for its premium orthodox teas produced in the eastern hill districts. The sector has been increasingly targeting high-value markets in Europe, North America, and Asia, while India remains its largest trading partner and transit route.

Industry experts note that maintaining smooth market access is critical for sustaining export growth, attracting investment, and preserving Nepal’s reputation in the global tea trade.

FNCCI has urged the government to engage with Indian authorities at both diplomatic and technical levels to remove unnecessary barriers and restore normal trade flows as quickly as possible.