Supplies ministry says PAC instructions on sugar prices impractical

Published On: October 6, 2018 09:15 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Oct 6: Minister for Industry, Commerce, and Supplies Matrika Yadav has said that the directive from the parliamentary Public Accounts Committee (PAC) to cap the price of sugar at Rs 63 per kilogram cannot be implemented.

Organizing a press meet at the ministry on Friday, a day after receiving directive from the PAC, Yadav has said that the price of sugar cannot be enforced as per the parliamentary panel because the price cap lacks rational ground.

On Thursday, the PAC had issued a directive to the ministry to ensure that the consumers are not forced to pay more than Rs 63 per kilogram for sugar. Stating that sugar producers have agreed with the government to not raise sugar price following the import restriction, lawmakers have demanded the government to curb the price rise. 

In a bid to protect domestic sugar industry and provide domestic production an easy access to the market, 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. The restrictive measure was also aimed at helping the domestic sugar mills clear their stock.

While pressing the government to set import quota, sugar producers have also reportedly made commitment to not increase sugar price. But going against the commitment, they have been found increasing the price arbitrarily.

Minister Yadav, however, said that the decision of the committee has been forwarded to the Prime Minister for guidance on how to implement the directive as the ministry was not able to implement such decision.

"We have received a letter from the committee. But, how the committee came to the conclusion that the price should not go beyond Rs 63 is unclear," said Minister Yadav. "Is the committee also going to fix maximum price of other commodities such as vegetables?" he asked. 

Ministry officials say that the ministry has recently fixed the maximum price of sugar at Rs 70 per kg. "The ministry has capped the price of sugar at Rs 70 after adjusting all costs including value added tax for sugar producers. If any retailer or shop is found of charging more than Rs 70, Department of Supply Management and Protection of Consumers' Interest will take action against such retailer,” said Santosh Bista, personal advisor of the minister. 

He said that the ministry has been conducting market monitoring to curb artificial price hikes in the market.

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