The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has called for a fundamental shift in how the state interacts with the industrial sector, arguing that the government should focus on creating a conducive environment rather than operating businesses itself. Speaking at a seminar organized by the Garment Association Nepal regarding the transition from Least Developed Country (LDC) status, FNCCI Senior Vice President Anjan Shrestha criticized the government's plans to restart the Hetauda Textile Industry. He argued that utilizing taxpayer funds to subsidize state-run entities like the Dairy Development Corporation or Nepal Drugs Limited creates unfair competition for private enterprises that are already struggling with high production costs.
The garment sector, which has seen its numbers dwindle from 1,250 factories to a mere 100, requires an integrated revitalization strategy. To bridge this gap, Shrestha introduced a "Five F" framework—encompassing Farm, Fiber, Fabric, Fashion, and Foreign markets—to streamline the supply chain from raw material to international export. He emphasized that this vision could be realized through a dedicated "Garment Council" or a specialized government department. While 70 percent of Nepal's consumption is currently met through imports, Shrestha views this not as a deficit but as a massive internal market opportunity for local manufacturing, ranging from needle production to vehicle assembly.
Beyond trade policy, the industry faces a looming demographic challenge. Shrestha warned that a falling birth rate and the mass migration of youth could result in a severe labor shortage, even as global debates focus on AI-driven job losses. Regarding the upcoming LDC graduation, the FNCCI is actively lobbying the government to delay the transition by at least three years to protect export incentives. While discussions with the Finance Minister have been positive, Shrestha stressed that the state must uphold its credibility by ensuring the timely disbursement of promised cash incentives to exporters. As he prepares to assume the FNCCI presidency following the March 12 (Chaitra 30) elections, Shrestha committed to a unified private sector where every entrepreneur’s expertise is utilized to strengthen the national economy.
