Action against defiant sugar mills

Govt moves to freeze bank accounts of three sugar mills

Published On: January 23, 2020 09:45 AM NPT By: Republica  | @RepublicaNepal

Seven sugar mills still owe millions to farmers

KATHMANDU, Jan 23: The government is freezing financial transactions of sugar producers who have failed to clear the dues of sugarcane farmers. 

Organizing a press conference on Wednesday to brief the media about the progress in release of payments to farmers, senior officials at the Ministry of Industry, Commerce and Supplies (MoICS) said that they will now recommend the authorities concerned to freeze all financial transactions of sugar mills that have not come to the government contact or have not paid farmers.

According to the officials, the move is a part of the government action against the defiant sugar mills that have not paid their dues to the sugarcane farmers for canes purchased in the previous season. Some mills have dues pending for years.

“We are writing to the Nepal Rastra Bank (NRB) seeking its help to freeze bank accounts of three sugar mills,” Dinesh Bhattarai, a joint secretary at the ministry, said. 

The ministry has started taking action against the sugar mills that defaulted on the payment to sugarcane farmers even after the Tuesday's deadline. Sugar mills have settled only 20% of their dues with farmers.

These sugar mills have been able to clear only around Rs 160 million out of a total of dues worth nearly Rs 1 billion, according to the ministry. 

According to Bhattarai, the ministry is asking the central bank to freeze the bank accounts of Annapurna Sugar and General Enterprise Pvt Ltd, Indira Sugar and Agro Enterprise Pvt Ltd and Lumbini Sugar Mill Pvt Ltd.

Signing a five-point agreement with agitating sugarcane farmers on January 3, the government had promised to make sugar mills clear all dues by January 21. 

Following the agreement, the agitating farmers had returned home after ending their weeklong protest. 

However, the sugarcane farmers say that their hopes have been dashed as sugar mills have paid them only nominal amount compared to the total cumulative dues.

MoICS Joint Secretary Bhattarai also said that they have sought the help of Ministry of Home Affairs to take necessary action against mill owners who have remained out of contact. 

According to MoICS, six sugar mills have already cleared their dues. Three sugar mills have made partial payment while four mills are still out of contact. 

There are 13 sugar mills in the country.

The government has repeatedly been directing sugar producers to pay the farmers on time, but to little effect. Although this year's cane harvest season is at its peak, farmers felt compelled to come all the way to the capital to put pressure on the government.


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