Nepal Civil Unrest Disrupts Food Supply Chain

In the wake of growing civil unrest and youth protests in Nepal, a few Indian fast-moving consumer goods (FMCG) companies have shut down operations in Nepal, hitting local supply chains hard and creating food and product shortages fears.

Biscuit giant Britannia Industries has suspended all production at its Simara factory in Bara district, due to safety reasons. The factory, which provides almost 80 percent of Britannia products retailed in Nepal, has around 350 employees. A company official said, "The safety of our people is of paramount importance, and we have shut down all our operations temporarily to ensure the same."

The factory, commissioned in 2017, produces 14,000 tonnes annually and earns Rs.170 to 180 crore each year. In FY2024-25, it paid Rs.26.8 crore as dividends and Rs.6.9 crore as royalties to its parent company in India, stated Britannia's annual report.

Key highlights:

• Britannia suspends operations at Simara plant due to civil unrest, affecting 80 percent of its Nepal supply and putting 350 local jobs at risk
• Bikaji Foods delays joint venture with Chaudhary Group, citing instability; Dabur Nepal shifts employees to remote work for safety
• Local supply chains face major disruption, raising fears of food shortages and underscoring Nepal’s reliance on Indian FMCG imports

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Local businesses fear severe product shortages. “These shutdowns will impact daily essentials in urban and rural markets alike. We’re already seeing reduced stock deliveries.” said Rajesh Pandey, a Kathmandu-based retailer.

Other Indian FMCG companies are also moving with caution. Snack foods manufacturer Bikaji Foods has put off its next joint venture project with Nepal's Chaudhary Group. "Zero investments have been made till date. The unrest has obviously put our plans on the backburner," its COO Manoj Verma stated.

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Dabur Nepal, too, has requested Kathmandu employees to stay at home and is watching the situation carefully. "Employee safety continues to be our highest priority," a spokesperson for the company explained.

The shutdown will further disrupt Nepal's food-processing industry and underline the nation's reliance on cross-border trade.