MoI proposal to check reality of sick industries face hurdle
REPUBLICA
KATHMANDU, Aug 22: The proposal of Ministry of Industry (MoI) to cross-check reality and genuineness of self-declared ´sick industries´ - which have pushed for relief packages from the government - has hit a snag after Ministry of Finance (MoF) refused to pledge budget necessary for the study.
The MoI, which is entrusted to implement the sick industry rehabilitation program, had asked for Rs 2.6 million to conduct the field study to verify claims made by 27 ´sick industries´.
But the officials at the MoF said the program was new one, and MoF was not in a position to allocate a portion of one-third budget to the MoI.
Though the government started program to provide ´relief program to the sick industries´ in 2011/12, no allocations were made for the program in the last fiscal year. “We received the MoI´s letter only after the new fiscal year began,” said Durgesh Pradhan, under secretary at the MoF. "And the ministry has not been able to decide whether to allocate budget, for it is entirely a new program," he told Republica.
The government has no authority to allocate budget to any new program since the budget for this fiscal year is just one third of the actual expenditure of the previous fiscal year 2011/12. “We have already started a preliminary study of the 27 industries, which have applied at the ministry to be treated as sick industries, on the basis of information they have provided to us,” Surya Kant Jha, under secretary at the MoI said. “We need budget to go in the field in order to authenticate the information they have provided to us.”
The ministry has a pressure to finish the field study and come up with the final list of names of the sick industries in order to provide them relief packages. The government has prepared a report that suggests what sorts of relief packages should be provided to the sick industries to revive them.
The Nepal Rastra Bank (NRB) central monetary authority, meanwhile, has also declined to ask bank and financial institutions to stop auctioning the property of the six industries - Birat Leather Industries, Birat Shoes Company, Everest Floriculture, Nepal Boards- producers of wooden goods, Siris Herbal Company and Dolphin Manor Wildlife Resort.
The MoI had requested NRB to process to save six industries from bank actions. NRB source had disclosed to Republica that the Bank and Financial Institution Act doesn´t allow it to ask any bank and financial institutions not to auction the property of defaulter.
“The process of identifying actual sick industries might not take place due to the budget crunch in the Ministry,” the official at the MoI said.
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MoI Proposal To Check Reality Of Sick Industries Face Hurdle
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