FNCCI President Appeals for Flexibility in Euro VI Enforcement

Chandra Prasad Dhakal, President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), has called on the government to allow, on a one-time basis, the import of vehicles that fall below Euro VI emission standards but have already been ordered.

Speaking at the inauguration of the NADA Auto Show 2025 on Tuesday, August 19, Dhakal said while the adoption of Euro VI standards is a positive step, its sudden enforcement had created difficulties for both buyers and manufacturers.

“The decision has affected vehicles already ordered and produced before the new rule came into force,” he said. “It has also affected manufacturers who supply to Nepal but had yet to open Letters of Credit (LCs).”

Under the Vehicle Emission Standard 2025, which came into effect on June 23, two- and three-wheelers as well as light four-wheelers must meet at least Euro 5 standards, while heavy vehicles must comply with Euro VI.

Nepal first introduced Euro I norms in the 1990s, upgraded to Euro III in 2012—skipping Euro II—and was supposed to adopt Euro IV by 2014. That transition never took place, meaning most vehicles in Nepal still operate under Euro III standards.

Responding to Dhakal’s appeal, Prime Minister KP Sharma Oli said the demand was “reasonable” and assured that the government would review the issue. He added that the state had introduced new policies and infrastructure to support modernisation and pledged there would be “no obstruction to investment and business.”

The new standard, however, already provides a concession for vehicles and parts imported under LCs opened before June 23, 2025. Such imports may comply with the preceding Euro III rules, according to a government notice published in the Nepal Gazette.

Industry insiders argue the government should have given more advance notice. But since Euro VI adoption has been under discussion for years, businesses were expected to be prepared. “Moreover, making exceptions for a single brand or case cannot be justified unless the issue is genuine,” said one observer.

Nepal began importing Euro VI-grade fuel in April 2020 when India made the switch. But much of it is still used in older vehicles, limiting its environmental benefits.

European emission standards, first introduced in 1993, set strict limits on pollutants such as nitrogen oxide (NOx), carbon monoxide (CO), hydrocarbons, and particulate matter. Euro VI regulations represent a major tightening for diesel engines, cutting NOx emissions to 80mg/km from the Euro 5 threshold of 180mg/km. For petrol cars, the NOx limit remains at 60mg/km.

While Euro IV fuels contain 50 parts per million (ppm) sulphur, Euro VI fuels have just 10 ppm. Cleaner fuel and stricter standards are seen as key to tackling air pollution and its health impacts.

The next phase, Euro 7, is expected to come into force this year.