KATHMANDU, Oct 11: Sugarcane farmers have sought the government’s intervention to settle their payment dues concerning Shree Ram Sugar Mills which remains shut since July 26. According to the farmers, the sugar factory owes Rs 410 million to the sugarcane farmers of Rautahat district alone.
Submitting a memorandum to the Parliamentary Industry, Commerce, Labor and Consumer Welfare Committee on Sunday, a group of farmers demanded the government take the initiative now. The sugar factory is reported not to have paid the farmers for their produce since 2014/15.
Apart from the farmers, the now-closed sugar factory also owes Rs 40 million to its employees. According to the farmers, the factory owner has been telling the farmers and its staff that all their due payments will be cleared “only after selling the factory’s fixed assets”.
Shree Ram Sugar Mills, one of the largest sugar manufacturers operating in Garuda of Rautahat, declared its insolvency some two and a half months ago. Stating that the company sustained huge financial losses in the past few years, the company’s management announced to close the factory permanently since the aforementioned date. According to the company’s source, it incurred a loss of Rs 2.17 billion as of 2018/19.
There are around 18,000 sugarcane farmers in Rautahat district. The farmers also demanded the government manage the revival of the sugar factory, arguing that its closure will affect the earnings of a large number of people relying directly or indirectly on the business of sugar and its raw materials supply.