Nepal is currently experiencing a period of unrest, with incidents of violence occurring in several areas, including the capital city, Kathmandu. The army has assumed control nationwide, which has brought some degree of stability. Despite this, the turmoil is affecting business operations, particularly for major Fast-Moving Consumer Goods (FMCG) companies. Production has been disrupted at both Dabur and Britannia.
Britannia has temporarily ceased production due to safety concerns for its workforce, whereas Dabur’s output has been partially affected. These decisions have been made to ensure the safety of employees. Given the significant presence of FMCG companies in Nepal, the instability could potentially impact consumer demand.
Britannia Industries has suspended production in Nepal in response to the ongoing violence. The company, which operates a plant in the Bara district, has emphasized the importance of employee safety. “Our priority is the safety of our employees,” the company stated.
The company, which owns brands like Good Day, Marie Gold, and Tiger, expressed appreciation to the local army for their intervention, which boosted employee confidence in security.
Dabur India’s plant in Birgunj, Nepal, has ceased production operations. The company has noted that the unrest is preventing employees from reaching the plant, which has had a significant impact on operations. Sales in Nepal account for around 3% of Dabur’s total revenue.
The company stated that it is closely monitoring the evolving situation in Nepal and has instructed all Kathmandu-based employees to work remotely. Sales teams have been directed to prioritize safety and comply with local curfew regulations.
The violence in Nepal has led to widespread chaos, with protestors targeting the residences and government buildings of political figures. The parliament building was also set ablaze. Multiple fatalities have been reported. The army took charge of security operations on Tuesday night, which has led to some improvement in conditions. The army is now deployed across the country.
Previously, Indian FMCG businesses encountered similar challenges in Bangladesh a year ago, when student protests led to the toppling of the Sheikh Hasina government. Companies such as Emami reported business impacts. Indian FMCG companies including Dabur, Britannia, Marico, Patanjali, ITC, and Reliance Consumer are established in Nepal. Most conduct business through local distributors or partnerships.