Nepal industrial authority cuts power, water to 167 factories over unpaid dues

Nepal's state-owned Industrial Zone Management Limited (IZML) has cut electricity and water to 167 factories within industrial estates for outstanding payments on land leases and utilities. The move, which began Wednesday and Thursday, followed a seven-day notice issued on June 8. As of Thursday evening, 87 factories had settled their dues and had services restored, while 80 remained disconnected. The enforcement action stems from years of legal disputes over revised industrial estate rental rates. A High Court ruling in April 2024 ordered industries to pay increased rents retroactively from 2018. However, the Supreme Court ruled in March 2025 that these revised rates were only lawful from July 6, 2022. IZML sought a review of this decision, arguing it would significantly reduce revenue, but the Supreme Court refused to allow the review petitions to proceed, upholding the earlier ruling. Padam Oli, general manager for IZML, stated that utility disconnections are pending for another 74 factories. Ajaz Alam, president of the Federation of Nepal Industrial Estate Industries, confirmed that factory owners will pay based on the 2022 rates, as per the Supreme Court's decision. However, Alam criticized IZML for the short notice period, alleging some factories had their utilities cut without prior warning.

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The disconnection drive will continue on Friday if the remaining factories fail to clear their dues.