India’s Strategic Move Counters China’s Nepal Push, Leaves Both Nations Uneasy

Representational image (Reuters via ANI)

New Delhi: India has launched a major crackdown on what it sees as a backdoor route for Chinese steel to enter its domestic market through neighbouring Nepal. New Delhi has tightened its import rules, effectively halting the flow of cheap Chinese-origin raw steel disguised as Nepalese cookware and utensils.

Enforced by the Bureau of Indian Standards (BIS), the new rule mandates that any steel product entering India must carry a quality certification mark. Crucially, this certification now applies not only to the final product, but also to the raw material used to make it.

The change has upended the long-standing trade practice of importing Chinese raw steel into Nepal, converting it into kitchen items and then exporting those goods to India.

Indian officials see this as a necessary step to protect domestic manufacturers and prevent dumping of low-cost and substandard Chinese products. For Nepalese exporters, however, the rule change has been devastating.

According to The Kathmandu Post, several key Nepali steel manufacturers, including Bhistar Global Private Limited and Panchakanya Steel, have reported a sharp decline in exports to India.

Panchakanya, which specialises in stainless steel tanks, has been forced to pause production altogether. “We can still make our products in Nepal,” said Devendra Sahu of Panchakanya, “but India now insists that even the raw materials must originate from within India. No more imported steel allowed.”

Bhistar Global, which used to export over 400 tonnes of steel kitchenware to India each month, is now down to producing merely 20 to 30 tonnes. Around 200 tonnes of finished goods are reportedly stuck in their warehouse, unsellable.

Arbind Tripathi, the company’s chief accountant, said that Nepal’s steel exports have come to a virtual standstill. “We used to rely on raw materials from China. Now, we cannot use that at all. We are trying to get the proper certifications, but the process is long and uncertain,” he said.

Ram Prasad Regmi, the chief of Nepal’s Bhairahawa Customs Office, confirmed that steel exports to India have been halted for over two months. “India recently implemented new software that tracks imported goods. Nepal has not yet been listed in the system, and until that changes, Nepalese traders will remain locked out,” he said.

This tightening of standards is not only about trade, it is also a strategic signal. India is making it clear that it will not allow its market to be used as a dumping ground for Chinese goods, even through intermediaries like Nepal. While Nepalese businesses are struggling to cope, New Delhi sees the move as a necessary defense of its economic interests.

China’s attempt to quietly re-enter the Indian market through Nepal appears to have been caught and shut down. India’s message is no shortcuts, no bypasses and no compromises on national manufacturing and product standards.