20 factories remain without power, water over unpaid dues

Twenty factories in Nepal's industrial estates are still without power and water after failing to pay outstanding dues, despite a broader payment drive that has reconnected most defaulting industries. The state-owned Industrial Zone Management Ltd (IZML) disconnected services for 167 factories across 10 estates on June 18 over unpaid rent and service charges.

IZML has recovered 467.31 million Nepalese rupees so far. Services were restored to five factories on Monday after they settled their arrears, but 20 remain disconnected. Before the campaign, industries owed over 890 million rupees in unpaid rent and service charges. Eight factories in the Hetauda Industrial Zone are among those still without electricity, along with others in Nepalgunj, Pokhara, Balaju, Dharan, Patan, and Gajendra Narayan Singh industrial zones.

The core of the dispute lies in a controversial rent increase implemented by IZML in 2022, made retroactive to 2018. Rents in some estates, like Balaju Industrial Zone, increased by as much as 686 percent. Industrialists challenged this in court. In April 2024, the High Court ruled industries liable for the revised rent from 2018, but the Supreme Court partially overturned this in March 2025. The Supreme Court stated the retrospective application from mid-2018 was unlawful and ordered the revised rates to take effect only from July 6, 2022.

Despite the Supreme Court's ruling, IZML's board sought a review, arguing it would necessitate significant refunds and reduce annual revenue. The Federation of Nepal Industrial Estate Industries and other business groups also filed review petitions. However, a Supreme Court bench rejected these review petitions, leaving the March 2025 verdict in force.

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The electricity and water connections of five factories were restored on Monday after they cleared their dues. The remaining defaulters are still disconnected.