KATHMANDU, Oct 9: The government has given a five-day ultimatum to sugar producers to clear their outstanding dues to sugarcane farmers.
A joint meeting of ministers of five different ministries has decided to take legal action against those sugar producers who fail to pay their dues to sugarcane farmers within five days.
This decision comes amid complaints from sugarcane farmers that sugar mills were reluctant to make payment to them even when the festive season is nearing.
Though the government has been repeatedly pressing sugar industries to settle all dues that they owe to farmers, they have been persistently delaying the payment.
According to an estimate of Sugarcane Producers Federation of Nepal, sugarcane industries in total owe Rs 1.3 billion to farmers.
“The meeting decided to give a deadline for sugar mills to clear dues of farmers within five days. If any of them fails to make payment that it owes to farmers, the agriculture ministry will recommend the action against such mill to take necessary legal action,” Chandra Kumar Ghimire, secretary of the Ministry of Industry, Commerce and Supplies, told a meeting of a sub-committee formed by the parliamentary Public Accounts Committee to look into the soaring prices of consumable goods in the market including sugar on the eve of festive season.
Finance Minister Yuba Raj Khatiwada, Industry, Commerce and Supplies Minister Matrika Yadav, Agricultural and Livestock Development Minister Chakrapani Khanal, Forests and Environment Minister Shakti Basnet, and Federal Affairs and General Administration Minister Lal Babu Pandit along with secretaries of respective ministries were present in the joint meeting that vowed to take legal action against the sugar mills who fail to clear dues of farmers.
According to Ghimire, the joint meeting has also decided to intensify market monitoring and inspection to curb artificial price hikes and black marketing to protect consumer interests. He also said that the central government will appeal and collaborate with provincial and local governments for market monitoring.
Speaking at the sub-committee meeting of the PAC, senior government officials questioned the honesty of sugar producers who had earlier reportedly made commitment to clear dues after the government imposes quantitative restriction on the import of sugar.
“The owners of sugar mills had made commitment that they will settle dues if the import restriction is imposed and their stocks are cleared,” said Yam Kumari Khatiwada, the industry secretary. “Now, no excuse of sugar mill will work. They will have to clear the dues within five days,” she added.
Out of 31 registered sugar mills, 13 are in operation, which crush sugarcane to produce sugar. In a bid to promote domestic industries and help clear the stock of domestic sugar, the government on September 17 had set sugar import quota for the current fiscal year at 100,000 tons.
As traders have already used import quota for the current fiscal year, they cannot import more sugar now.
While the sugarcane farmers are yet to get their payment, sugar mills have been raising sugar price after the import restriction was imposed. The sugar price has already been raised to Rs 75 from Rs 60 per kg.
“Until last year, sugar mills used to complain that their stocks have piled up, sales have gone down and they have not got fair price due to huge imports. They do not have such excuses anymore. Still, they have not paid the farmers. The honesty of sugar mill owners is questioned now,” said Ghimire.