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Economy

Protests disrupt critical trade with India

Kamal Thapa, left, Nepal's deputy prime minister, briefed Indian Prime Minister Narendra Modi in New Delhi on Oct. 19 about political unrest in his Himalayan nation and the disruption to cross-border trade. (Photo by India's Press Information Bureau)

NEW DELHI -- During a three-day visit to India, Kamal Thapa, Nepal's deputy prime minister and foreign minister, briefed Prime Minister Narendra Modi on Oct. 19 about political unrest in the Himalayan nation and the disruption to vital cross-border trade.

     Nepal has recenty seen violent protests by Madhesi people who live in the fertile Terai plains bordering India. Other minority communities have also protested as discriminatory the new constitution promulgated on Sept. 20, leaving over 40 dead.

     The protests have affected cross-border trade. According to Indian officials, the obstructions are on the Nepalese side and have disrupted the importation of essentials, including fuel which Nepal obtains entirely from India.

     India is landlocked Nepal's largest trading partner and sole gateway to the outside world. The two countries share an open border with reciprocal visa-free entry for their nationals. Some 6 million Nepalese live in India while Nepal is home to about 600,000 Indians.

     According to Nepal's Himalayan Times, Thapa said on his return that Indian authorities were diverting cargo trucks stuck in India to calmer border crossings.

     Indian companies set back by the unrest include Dabur India which has a plant producing its Real fruit juices in Nepal. "The supply of products by our subsidiary Dabur Nepal Pvt. Ltd. has been affected," the company said in a recent stock exchange filing. "The financial impact can't be ascertained accurately due to the ongoing nature of the situation."

     Dabur is stepping up production in other plants, including in Sri Lanka. Its Real brand is over 15 years old, and had sales of 10 billion rupees in the year ending in March. Sales of the brand in Nepal have not so far been affected.

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