December 1: Food industry leaders have accused banks of manipulating data related to agriculture sector which falls under priority sector lending. The government has listed agriculture as a priority sector making banks and financial institutions to release ten percent of the total loans to the agriculture sector. But the food industrialists claim that loans issued at a high interest rate of fifteen percent for industries manufacturing rice and oil have also been included in agriculture sector lending data.
Officials of the Association of Nepalese Rice, Oil and Pulses Industry met Finance Secretary Madhu Kumar Marasini, Director General of the Department of Industry Jiv Lal Bhusal and Director General of the Department of Commerce, Supply and Consumer Protection Prem Kumar Shrestha separately and complained that the government has become mute spectator to the irregularities conducted by banks. They have demanded concessional loans to be provided to such industries on priority basis and punish the banks for manipulating lending data.
Issuing a press statement, the association has demanded concessional loans to agro-based industries such as rice, oil and pulses or else stop deceiving people by showing fake lending data to these industries.
Strict provision on rice import
To protect the rice industries, entrepreneurs have urged government officials to reduce the duty on import of paddy from five percent to one percent and increase import duty on rice to fifteen percent from eight percent.
They have urged the concerned authorities to open the export of Basmati rice from Nepal. They have also requested to check the maximum price and quality of food items imported in Nepal and make arrangements to disclose the name, address and expiration date of the imported product.
Reduce tax on edible oil
Entrepreneurs have demanded that the government reduce VAT applied on edible oil to five percent. “If the five percent customs duty on mustard oil is reduced to one percent, domestic oil industries can get some relief,” said Subodh Kumar Gupta, president of the Association.
According to the entrepreneurs, oil produced in Nepal has become more expensive than the Indian oil due to five percent customs duty on import of mustard and 13 percent value added tax on processed oil. This has made the business challenging for homegrown manufacturers, they claimed.
Dissatisfaction over reduction in subsidy
Entrepreneurs are dissatisfied with the government over the removal of provision of cash subsidy on export of pulses. The government used to provide a four percent cash subsidy on pulses export. Removal of cash subsidy has made it challenging for the Nepali industries to export pulses to Bangladesh, said Gupta.