STC earns Rs 1bn in sugar scandal

KATHMANDU, SEp 10: 

Salt Trading Corporation (STC) — a public enterprise — has earned about Rs one billion by artificially increasing the price of sugar. 

STC sold sugar at a high profit and manipulated the market, claimed consumer rights group Forum for Protection of Consumer Rights-Nepal. 

STC sold sugar with 42 per cent profit in one kg, said secretary of the rights group Bimala Khanal. “It was all done with the nexus of STC officials and big traders,” she said. 

A profit of over 20 per cent on factory gate price is illegal according to the black marketing law of the country. 

“But STC did it in the last three months,” she said, adding that the public enterprise bought 50,000 metric tonnes of sugar at Rs 55 per kg from sugar companies and sold it at Rs 76 a kg. It amounts to an embezzlement of over Rs one billion, so we have complained to the regulating authority, she added. 

The regulating authority –– Department of Commerce and Supply Management –– which is investigating the issue says that there are discrepancies in the buying and selling process. “Yes, there are irregularities in the process,” said director general at the department Narayan Prasad Bidari. “But I cannot give details today because investigation is going on.” 

The consumer group has claimed that STC was involved in artificial price hike to support traders. “It is also to be blamed for the scarcity,” she said. 

The price of sugar had jumped to Rs 90 a kg in mid-August because of a scarcity. However, prime minister Dr Baburam Bhattarai’s intervention on the issue helped in reducing the price to Rs 85 in late August but the price has not decreased to the level that he has directed. The prime minister had asked for sugar to be sold at Rs 76 a kg, on August 27, in a meeting with public enterprises and regulating authorities. 

Meanwhile, the consumer group has also urged the government to take the initiative to check the stock of food items with traders — stockists and wholesalers. It has also asked the government to set the maximum retail price of essential consumer goods. 

The Ministry of Commerce and Supplies had promised 

that it would announce the maximum price of rice, wheat flour, pulses, edible oils and others today. But the promise failed to materialise.

Source: THT