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Trade & Tariffs

Nepal's Tea Factories Reopen After India Cuts Testing to a Fifth of Consignments

Nepal's tea factories, shut since mid-June over India's mandatory export testing, resumed work after Kathmandu's intervention and an Indian shift to random 20% sampling. A government task force has two weeks to propose a lasting fix.

Nepal's tea factories, idle since mid-June after India made laboratory testing mandatory on every consignment of imported tea, have reopened. Producers resumed operations from Friday, June 26, after the Office of the Prime Minister and Council of Ministers pledged to pursue the export bottleneck and India moved to test only a fraction of shipments, the Kathmandu Post and the AFP-serviced report in The Star said.

Terraced green tea gardens on hillsides at dusk in Ilam, eastern Nepal.
Tea gardens in the hills of Ilam, in eastern Nepal.Nishant Rana

The change that let the leaf move again came from India's food-safety regulator. On June 23 the Food Safety and Standards Authority of India issued a directive requiring only about 20 percent of tea consignments to undergo random laboratory testing, down from the every-shipment rule that had brought the trade to a halt, the Kathmandu Post reported. A Ministry of Industry spokesperson in Kathmandu, Netra Prasad Subedi, said all the factories were open again, The Star reported.

The stoppage was costly while it lasted. Around 99 factories across Jhapa, Ilam and the rest of eastern Nepal had suspended operations, and more than 50 tea estates were disrupted, the Nepal Tea Producers Association said. About 300,000 kilograms of processed tea sat stranded in warehouses in India and more than a million kilograms were stockpiled in Nepal, the association said. The Star reported the disruption hit more than 3,000 tea-farming families, and that it fell during the peak picking season, when leaf that is not processed is leaf lost.

"Factories across Jhapa, Ilam and the rest of eastern Nepal will resume operations from Friday," Aditya Parajuli, president of the Nepal Tea Producers Association, said. Producers agreed to restart after the government assured them it would urgently pursue diplomatic and administrative measures, and the Prime Minister's Office formed a special task force, giving it two weeks to recommend immediate, medium-term and long-term steps.

The reopening settles the immediate stoppage, not the dispute behind it. India first imposed full sample testing on Nepali tea in 2024, and the Darjeeling trade has for years argued that Nepali orthodox leaf, grown in adjoining hills, is blended into tea sold abroad as Darjeeling. More than 80 percent of Nepal's tea is sold to India, the National Tea and Coffee Development Board says, so a testing rule at the border is, in effect, a tap on the whole industry. The task force's brief is to keep it from being turned off again.


Sources: The Kathmandu Post, "Nepal's tea industry reopens after government assurance despite India's stricter import testing" (June 26, 2026); The Star, "Nepal's tea factories resume work after India eases rules" (July 1, 2026); ekantipur, "Agreement reached to reopen closed tea factories in Ilam" (June 24, 2026).

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