Firms finally start building factories in Bhairahawa SEZ

A main entrance of Special Economic Zone (SEZ) in Bhairahawa of Rupandehi district, on Tuesday, February 06, 2018. Photo: RSS

Kathmandu, June 28

Following the availability of electricity, domestic firms have finally started the construction of their respective factories inside the Bhairahawa Special Economic Zone (SEZ).

Two domestic firms, namely IDS Electronic and Shakti Minerals, have begun the factory construction works, while the construction of the remaining 24 planned factories inside the maiden SEZ of the country will begin within one month, informed Chandika Bhatta, executive director of SEZ Authority, Nepal.

Though 19 business firms had signed an agreement with the government to establish factories within Bhairahawa SEZ more than a year ago, they were hesitant to begin construction of the factories owing to lack of assurance of electricity supply from the government.

However, Bhatta said that Nepal Electricity Authority (NEA) has started providing the required quantum of power to Bhairahawa SEZ, following which business firms have started building their factories there.

According to him, NEA is currently supplying electricity to Bhairahawa SEZ via 11kV transmission line. The authority has assured to supply 33kV dedicated line to Bhairahawa SEZ from its Dhagdhagi substation within one year.

“All business firms have said that they will begin construction of their factories within one month,” informed Bhatta.

Of the two industries that have started construction of factories inside Bhairahawa SEZ, IDS is setting up a production plant of spare parts of vehicles (two-wheelers), while Shakti Minerals will set up a mineral processing plant.

As per the SEZ Authority, Shakti Minerals is injecting an investment of Rs 400 million inside Bhairahawa SEZ, while IDS will invest Rs 250 million. These two companies are expected to generate employment opportunities for almost 400 people in their factories.

Prominent business houses like Golchha Organisation, Jagadamba Group, Vaidya’s Organisation, Lohiya Group and Siddhartha Group, among others, have taken approval to set up factories ranging from bottling plants and metal processing and industries to manufacturing polymers, beverages, electric products and noodles, among others, within the Bhairahawa SEZ.

The government has developed the SEZ to address supply-side constraints in a bid to boost exports. Industries established within SEZ will need to export 75 per cent of their production.

Meanwhile, Bhatta also informed that the SEZ Authority has begun the works regarding land plotting in the planned SEZ at Simara. Similarly, SEZ Authority is awaiting the government’s approval to cut down trees at the planned SEZ in Panchkhal.

The government envisions constructing at least one SEZ in every province and altogether 14 SEZs across the country in the long run.