More than 2,400 tonnes of sugar imported by Salt Trading Corporation (STC) has been lying idle at the Dry Port in Sirsiya, Birgunj, following the import restriction by the government. The sugar was imported targeting the Dashain, Tihar and Chhat festivals when demand for sugar increases significantly.

The STC is expected to incur a heavy financial loss from the government’s decision as it will not be able to sell the goods at a time when demand soars. STC had purchased sugar from Renuka Sugar Mills in West Bangal of India. The STC has to pay warehouse charges. Amoj Lamichhane, regional chief of STC, said the corporation had purchased 5,000 tonnes of sugar from the Indian company. Last year, the corporation had called global tender to purchase sugar.

According to Lamichhane, the corporation was supposed to import sugar two months ago. “However, due to unavailability of railway rakes, the consignment moved to Nepal from the Haldiya Port in India only on September 8,” he said. “With the additional delay in shipping, it arrived into Nepal after two weeks.”

On September 17, the government imposed quantitative restriction on imported sugar. The government took the measure in the name of protecting domestic sugar producers who were complaining about not being able to sell the domestic products as cheaper imported sugar had dominated the market.

Following the government decision, the customs office in Birgunj has been refusing to provide clearance to the STC to import sugar, according to Lamichhane. Annually, the government through the STC has been selling subsidised sugar targeting festivals shoppers. This time, the government has barred STC from selling its product, citing the high price that the enterprise has fixed.

With the obstruction in supply, the market price of the sweetener has surged by Rs20-25 per kg in the last few days. Consumers are compelled to pay Rs85-90 per kg for the product that used to cost Rs60-65 previously. Since last year, the government doubled the customs duty on sugar import to 30 percent. In 2016-17, Nepal imported 56,100 tonnes of sugar worth Rs3.68 billion. A total of 106,200 tonnes of sugar worth Rs5.72 billion was imported in the last fiscal year.