The implementation of a new Standard Operating Procedure (SOP) on Nepali tea by the joint meeting of the Indian Tea Board and the Department of Commerce, effective from May 12, 2026, has resulted in the loss of employment for 60,000 tea workers and employees in the district.
The closure of 32 tea factories in Jhapa, effective June 18, 2026, following difficulties exporting Nepal-produced tea due to Indian policy, has left workers unemployed.
According to Aditya Parajuli, Central President of the Nepal Tea Producers Association, a total of 60,000 tea factory employees and tea workers in the district alone have lost their jobs.
A total of 60,000 people employed in 32 tea industries, including one government-owned and four cooperative-run factories, have been unemployed since June 18.
Nepali tea exports have been seriously affected by the new Standard Operating Procedure (SOP) introduced by India on May 12, 2026.
As a result of the new Indian SOP, 53 orthodox tea factories in Ilam had already shut down from June 15.
The Nepal Tea Producers Association informed a press conference held in Birtamod on June 17 that tea factories in Ilam and Jhapa had been forced to close due to the Indian policy.
The press conference stated that the annual turnover of CTC and orthodox tea produced in Nepal amounts to Rs. 14 billion, and that more than 100,000 workers in Ilam and Jhapa have lost their employment.
Of the tea produced in Ilam and Jhapa, tea worth approximately Rs. 5 billion used to be exported to India annually.
The implementation of the new SOP by the Indian Tea Board has created serious obstacles to Nepali tea exports. According to Aditya Parajuli, Central President of the Nepal Tea Producers Association, tea exports from Nepal to India have virtually ceased for nearly two months due to various quality tests, complex procedures, and storage-related requirements.
Even ready-to-export tea that has already crossed customs checkpoints is now required to be stored in the warehouses of Indian buyers. The Indian Tea Board collects samples from these warehouses for testing, and the test reports take between 20 and 25 days to be released. As a result, the quality of the tea stored in warehouses is also deteriorating.
The addition of impractical provisions by the Indian side, such as requiring the destruction of tea if laboratory reports indicate substandard quality, has created a crisis for Nepal’s tea industry.
During the press conference, it was stated that tea industries in Ilam and Jhapa are now uncertain whether they will receive payment for tea already exported to India. According to Aditya Parajuli, tea entrepreneurs are further burdened because they are required to bear warehouse rental costs throughout the testing period.
Tea industrialists stated at the press conference that due to the accumulation of tea in warehouses caused by the new Indian policy, they are unable to make timely payments for green tea leaves purchased from farmers, electricity bills, Value Added Tax (VAT), and other financial obligations.
Senior Vice-President of the Association, Shiva Kumar Gupta, stated that tea factories would not reopen unless the government immediately addressed the problems facing the tea sector.
Tea entrepreneurs and businesspersons have drawn the attention of the Government of Nepal through the District Administration Office, Jhapa, requesting intervention to resolve the crisis affecting Nepali tea exports.
According to the Association’s General Secretary, Shukra Dahal, a memorandum was submitted on June 17 to Assistant Chief District Officer Anjan Neupane, demanding that the Government of India withdraw the policy imposed on Nepali tea.