Handicraft sector hit hard over shortage of raw material

The country’s largest annual handicraft trade fair, Handicrafts Trade Fair 2015, that was schedule to open at Bhrikuti Mandap Exhibition Hall on November 26, had been postponed as the handicraft sector is facing difficulties over shortage of raw materials resulting from the agitation in the Tarai and trade embargo by India.

Exports have come to a complete halt, and handicraft makers have not been able to fulfil even domestic demand as they lack the necessary materials. The fuel crisis has also affected the production of handicrafts.

More than 60 percent of the raw materials are imported from China, India and Singapore. All the shipments are stuck at Birgunj Customs or Kolkata port in India, and production has been hit as a result, said Hem Ratna Shakya, president of the Federation of Handicrafts Association of Nepal.

Shakya said that domestic sales and the international market have been growing, and many people are engaged in the handicraft business. Making handicrafts is their livelihood, and the current slowdown has hit them heavily. The handicraft industry could suffer severely if the suspension in the supply of raw materials continued.

According to the association, around 50 percent of the handicrafts are sold during festivals like Dashain, Tihar and Christmas. Domestic handicrafts have been gaining popularity as gift items, but this time they were not able to offer new products to their customers. Traders don’t have high hopes about sales this Christmas.

Nepal exports a wide range of handicrafts including woodcraft, metal craft, silverware, felt products, Dhaka cloth, cotton garments, pashmina, ceramics, handmade paper, leather products and bamboo products to various international markets. Traders said that domestic demand had been growing rapidly.

Meera Bhattarai, president of the Crafts Producers Association said that entrepreneurs will have to stop work if the situation does not improve in the next few days. They need diesel to operate the steam boiler. Similarly, they need kerosene, oil and other fuels for the textile industry, but they are all in short supply. Entrepreneurs who depended on this industry had been hit hard as their income had shrunk.

According to the association , handicraft exports to India dropped 12.5 percent to Rs67 million in the first three months of this fiscal year. Similarly, shipments to third countries declined by 8.3 percent to Rs23.9 million from Rs26.1 million in the first quarter.

The country’s handicraft industry by and large has an annual turnover of Rs8-10 billion, and 1.1 million people are directly or indirectly associated with the sector.