Updated on Wednesday, December 06, 2006, 00:00 IST

Kathmandu, Dec 06: The largest garment exporter of Nepal has shut down its operation citing labour problem.

Cotton Comfort, which exports USD 9 million worth of readymade garments annually, has closed down its production due to the increased intervention by the Maoist trade union and other trade unions affiliated with the major political parties, according to sources at the Federation of Nepalese Chamber of Commerce and Industries.

"We have decided to close down the production as we were doubtful of meeting commitments for timely delivery," said Subhrat Dhital, the chairman of the company.

Sources in the factory said increased intervention by the trade union activists forced the management to shut down its production unit.

The factory, which accounts for 18 percent of the total garment export to third country, last year won the top foreign currency earning exporter award.

Cotton Comfort, located in Kathmandu, has been shut down at a time when the Seven-Party Alliance government and the CPN-Maoist have signed a peace agreement to end the decade long conflict and restore lasting peace in the country.

The message sent by the senior political leaders was not translated into action at the grassroot level, said Uday Raj Pandey, general secretary of the Garment Association of Nepal.

Entrepreneurs over the past few months have been citing that labour problems has seriously affected timely delivery of goods. The situation in the garment factory was no different than what is happening in the whole industry, he added. The number of operating garment factories has declined to 9 from 18 over the last one year.

Bureau Report