PARSA, AUG 20, 2012
Birgunj Sugar Mill has been closed for a decade, but the government has been spending Rs 3.5 million monthly on staff salaries and office expenses as it can’t make up its mind what to do with the defunct factory.
There are 26 employees including chiefs of administration, accounts, store, electricity and water besides 21 security guards. All of them had been hired on a temporary basis.
Meanwhile, the company owes hefty sums for raw materials, machinery and chemical supplies which were purchased when the factory was running. The Armed Police Force has been deployed at the factory to protect its physical assets. It has fixed assets worth Rs 7 billion.
The factory is spread over 52 bighas of land. There is a pond 14 bighas 15 katthas in area 1 km to the north of the factory. The pond has remained neglected. Meanwhile, a special economic zone is being constructed on 700 bighas of the factory’s land in Simara and Dumerwana.
A meeting of the council of ministers held on Feb 28, 2000 had decided to privatise the sugar mill. The company stopped operations three years after the government’s decision. Although the government has twice called for bids to privatise it, the process has been abandoned midway on both occasions due to changes in government.
The factory was established in 1965 with assistance from the Soviet Union. It had a capacity to crush 1,500 tons of sugarcane daily. The factory employed 924 permanent employees and 300 workers on daily wage basis. When the factory was closed, 731 employees opted for retirement accepting the severance deal offered by the government. Meanwhile, 200 employees are locked in a dispute with the government seeking more facilities. When 700 employees were laid off under the compulsory retirement scheme in 1992 and voluntary retirement scheme in 1995, the factory paid out Rs 100 million precipitating a financial crisis.
When Prime Minister Baburam Bhattarai was the finance minister four years ago, a high-level taskforce was formed to resume operations at the factory. Its administrative officer Abadh Kishor Singh said that the taskforce had submitted its report and the government had also made attempts to bring it back into operation.
But as a series of governments kept coming and going, the plan never happened. Singh added that the physical condition of the factory was still good and it could be operated if the government wanted to. Former CA member Omprakash Sharma said the factory that was a reliable economic source for a long period should be brought into operation again.
Source: The Kathmandu Post
Birgunj Sugar Mill has been closed for a decade, but the government has been spending Rs 3.5 million monthly on staff salaries and office expenses as it can’t make up its mind what to do with the defunct factory.
There are 26 employees including chiefs of administration, accounts, store, electricity and water besides 21 security guards. All of them had been hired on a temporary basis.
Meanwhile, the company owes hefty sums for raw materials, machinery and chemical supplies which were purchased when the factory was running. The Armed Police Force has been deployed at the factory to protect its physical assets. It has fixed assets worth Rs 7 billion.
The factory is spread over 52 bighas of land. There is a pond 14 bighas 15 katthas in area 1 km to the north of the factory. The pond has remained neglected. Meanwhile, a special economic zone is being constructed on 700 bighas of the factory’s land in Simara and Dumerwana.
A meeting of the council of ministers held on Feb 28, 2000 had decided to privatise the sugar mill. The company stopped operations three years after the government’s decision. Although the government has twice called for bids to privatise it, the process has been abandoned midway on both occasions due to changes in government.
The factory was established in 1965 with assistance from the Soviet Union. It had a capacity to crush 1,500 tons of sugarcane daily. The factory employed 924 permanent employees and 300 workers on daily wage basis. When the factory was closed, 731 employees opted for retirement accepting the severance deal offered by the government. Meanwhile, 200 employees are locked in a dispute with the government seeking more facilities. When 700 employees were laid off under the compulsory retirement scheme in 1992 and voluntary retirement scheme in 1995, the factory paid out Rs 100 million precipitating a financial crisis.
When Prime Minister Baburam Bhattarai was the finance minister four years ago, a high-level taskforce was formed to resume operations at the factory. Its administrative officer Abadh Kishor Singh said that the taskforce had submitted its report and the government had also made attempts to bring it back into operation.
But as a series of governments kept coming and going, the plan never happened. Singh added that the physical condition of the factory was still good and it could be operated if the government wanted to. Former CA member Omprakash Sharma said the factory that was a reliable economic source for a long period should be brought into operation again.
Source: The Kathmandu Post
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