Nepal’s iron and steel exports have witnessed a steep decline following the implementation of safeguard measures by India, highlighting the significant impact of trade policy changes on the country’s manufacturing sector. Industry officials report that exports have fallen sharply as higher import duties have reduced the competitiveness of Nepali steel products in their largest export market.
India introduced safeguard duties to protect its domestic steel industry from rising imports, but the move has had unintended consequences for neighboring Nepal, whose steel manufacturers rely heavily on the Indian market. The additional tariff burden has increased the cost of Nepali iron and steel products, prompting many buyers to shift to domestic suppliers or alternative sources.
According to industry estimates, Nepal’s iron and steel exports have declined by nearly two-thirds since the safeguard measures took effect. The sharp contraction has affected production levels, reduced export revenues, and created uncertainty for manufacturers that depend on cross-border trade.
Trade associations in Nepal have urged both governments to engage in dialogue to address the issue, arguing that Nepal’s exports constitute a relatively small share of India’s overall steel imports and therefore pose limited risk to the Indian industry. They have also called for special consideration under existing bilateral trade arrangements to help restore market access.
The decline in steel exports is expected to weigh on Nepal’s industrial output and export earnings unless alternative markets are developed or the trade restrictions are eased. Industry stakeholders remain hopeful that continued diplomatic engagement and trade negotiations will help resolve the issue and support the recovery of bilateral steel trade.
