Industry body Ficci today said the "malicious" campaign by a Nepalese media house against FMCG firm Dabur would impact Indian investments in the Himalayan nation.
"The current bout of the malicious campaign by a Nepalese media house against Dabur India is bound to force Indian investors into their shell and result in shying away of FDI to Nepal," Ficci said in a statement.
Indian joint venture Dabur Nepal has come under attack from the Nepalese media, which has alleged the firm was supplying low quality products.
The Indian embassy in Kathmandu recently asked the Nepalese government to take action against the "baseless adverse publicity" against the firm.
"Indian companies have made a significant contribution to the Nepalese economy both in terms of employment generation and by way of generation of revenue to the Nepalese exchequer," Ficci Secretary General Amit Mitra said.
The JV directly employs over 1,000 people and about 30,000 indirectly and it has generated revenue of over 40 crore Nepali rupees for the Himalayan Kingdom's exchequer.
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Indian industry has made a total investment of Rs 1,400 crore in Nepal, of which Dabur's share is Rs 143 crore.
"The need of hour is to encourage Indian investments into Nepal, provide the right framework for investment policies, create conducive labour laws and forge new partnerships in areas of health and education," the chamber said.
Some of the other Indian companies with a presence in Nepal include ITC, Unilever, United Telecom, State Bank of India, Punjab National Bank, Manipal Group and SJVN.