Impact of the West Asia Conflict: Rising Shipping Costs Push Up Production Expenses in the Sunsari–Morang Industrial Corridor

The ongoing conflict in West Asia has started to directly impact Nepal’s industries, particularly in the Sunsari–Morang Industrial Corridor, where production costs are rising sharply, according to industrialists. Shipping companies have increased freight charges by $1,500 to $2,000 per container under “force majeure,” yet raw materials are still not arriving on time. Rising risks around the Strait of Hormuz have disrupted the supply of plastic raw materials, petroleum products, and packaging materials. As a result, industrial production costs have increased by at least 8–10 percent, while plastic packaging prices alone have surged by up to 50 percent within three weeks. The conflict involving Iran, Israel, and the United States has also pushed up the prices of transportation, food items, cooking oil, and other daily essentials, affecting both industries and consumers.