Sekhar Golchha, senior vice-president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), chose to establish his new factory, Hulas Auto Craft, near Bhairahawa. 

Golchha said he decided on the site after finding the business environment in the region more conducive compared to other places in the country. 

Bhumahi in Nawalparasi, where Hulas Auto Craft is located, is a short distance from the Bhairahawa-Sunauli customs point. The motorcycle assembly plant will begin operations in a few days. 

“An industrial revolution will start from this region in the next five years,” Golchha said, speaking at the event organised by the Siddhartha Chamber of Commerce and Industry. “This region has all kinds of physical infrastructure required to set up manufacturing units.” There is no labour shortage in the area and it is less affected by political and ethnic movements, according to Golchha. 

Moreover, a well managed customs office, special economic zone and the ongoing construction of an international airport are other reasons behind the good industrial environment in the region, he said. 

The region has been attracting domestic and foreign investment mainly in tourism and manufacturing. The customs point was largely unaffected even during the Madhes movement and Indian blockade, encouraging big investors like Golchha to bring their capital to the region. 

Cement factories, tourist hotels, food processing units, noodle factories, pharmaceutical factories, steel rolling plants, distilleries and breweries have been flocking to the region. 

According to the Inland Revenue Department, 61 new businesses with a combined investment of Rs1.5 billion were set up on the Bhairahawa-Butwal, Bhairahawa-Lumbini and Bhairahawa-Bhumahi roads last year. Most of them are hotels, gas plants, hospitals, distilleries and food processing factories. 

Former FNCCI president Pashupati Murarka, who has established two cement factories in the Bhairahawa-Lumbini corridor, is planning to make further investments in the region. 

“Lately, the industrial environment in the region has improved, and I have been thinking about establishing new factories here,” said Murarka. “Earlier, Biratnagar was the best place to establish a factory. Then Birgunj took over. Now, it is Bhairahawa.”  

According to Murarka, Nepal has become less dependent on industrial raw materials imported from third countries, but its dependence on India has increased. “It is easier to import industrial raw materials from India via Bhairahawa,” said Murarka. “Similarly, shipping finished goods to major cities like Kathmandu, Chitwan and Pokhara is also much easier.”