Average Capacity Utilization of Industries In Province 2 Increases to 52.47 Percent

November 23, 2021 | Investopaper

The average capacity utilization of the industries in Province 2 has increased in the fiscal year 2077/78. As per the study report on economic activities of state 2 published by Nepal Rastra Bank (NRB), the average capacity utilization of industries of Province 2 is 52.47 percent. In the previous fiscal year 2076/77, the average capacity utilization of industries was 44.90 percent.

The increase in the capacity utilization of the industrial sector compared to the previous year is due to the availability of vaccines among workers and the adoption of various precautionary health measures.

In the fiscal year 2077/78, the soybean oil industry is at the top with average capacity utilization of 95.35 percent while the paper industry has the lowest average capacity utilization of 4.68 percent.

The total loan floated by the banks to the industrial sector of state 2 has increased in the fiscal year 2077/78 by 11.04 percent. Such loan as of Ashad’s end 2077/78 has reached 1.05 Kharba which was Rs 94.76 Arba until the end of Ashad, 2077 BS.  Out of the total loan invested, Banks have disbursed the highest loan of 59.32 percent in the Parsa District alone. Likewise, the Saptari district has the lowest loan investment by the banks with 2.19 percent.

Province 2 offers huge potential and opportunities for the growth of the industrial sector that includes:

–Availability of land for industrial expansion

–High population density

–Agriculture based industries

–Potential of creating industrial-based market as most of the area is connected with India.

–Easy access to market area due to industrial development.


Along with the promised opportunities, industries are facing a lot of challenges in state 2.

–Industries that suffered due to the pandemics need various relief packages and programs to bring them to their original position.

–Lack of investment-friendly environment.

–Lack of Infrastructure development

–Lack of Quality control

–Unavailability  of skilled manpower

–Lack of Investment-friendly rules and policies to attract Foreign Direct Investment

–Lack of Research-based budget program

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