Cosmetic industry down by unrest, trade embargo

- SUMAN BASHYAL, Kathmandu

Dec 23, 2015-

Sales and production of beauty products have been affected by the ongoing Tarai unrest and India’s unofficial trade blockade. Imports from India and China, the major sources of beauty products for Nepal, are down; and domestic production has come to a halt due to shortages of raw materials and fuel.  Local manufacturers said that they had not been able to produce cold cream for this winter. Most of the factories making cosmetics are closed while some have slashed output.

Freshia, Enricher, Dekar and New Look are some of the local brands that have been increasing their presence in the market that used to be highly dominated by imported products. Traders said that demand for cold cream and moisturiser soar during the winter season. Imports of beauty products from India have plunged 44 percent while imports from China decreased by 18.8 percent in the first four months of this fiscal year, according to Nepal Rastra Bank (NRB).

Nepal imported cosmetics worth Rs424.5 million during the period mid-June to mid-October this fiscal year, down from Rs760.7 million during the same period last year. Imports from China stood at Rs76.8 million against Rs94.6 million previously.

Hemanta Niroula, managing director of Delta Marketing, the manufacturer of Freshia and importer of Astaberry in Nepal, said that their factory was closed and that imports from India had dropped, affecting business and revenues. “We have to import the ingredients and packaging materials from India, but all the raw materials are stuck at the border. As a result, our production of beauty products has come to a standstill. But we have been fulfilling the demand for imported products,” said Niroula.

Delta produces 12 ranges of beauty products including cold cream, face wash and cleansing milk. Niroula also said that some quantities of cosmetics had been brought to Nepal by rerouting the shipments, but the high transportation costs and detention charges had made them very expensive.Bijendra Shakya, managing director of Cosmo World, the manufacturer of Enricher cosmetic products, said that they had to stop manufacturing cold cream for lack of raw materials. “The factory has been totally closed for two months as the raw materials stopped arriving from India after the blockade, and the goods in stock have been sold out. So we are having a hard time paying the salaries of our employees,” said Shakya. Cosmo World produces eight varieties of cosmetic items including face wash, hair oil, cleansing milk and body scrub. The company has postponed the planned launch of cold creams for this winter season. “We had planned to introduce cold cream this winter, but the blockade killed our plans,” said Shakya.

Published: 23-12-2015 10:04

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