Today is the last day for sugar mills to clear overdue payments to farmersBut there is little chance that the sugarcane growers will get their money, officials said.
The deadline given to sugar mills to clear overdue payments to sugarcane farmers for their crops expires on Tuesday, but there is little chance that they will get their money, officials said.
On January 3, the Ministry of Industry, Commerce and Supplies, sugar mills and sugarcane growers reached an agreement setting January 21 as the deadline for clearing all outstanding payments.
According to the Department of Industry, the mill owners owe a total of Rs1 billion to the farmers, out of which they have paid only Rs150 million so far.
Six mills—Indu Shankar Sugar Mill, Everest Sugar Mill, Bhageshwor Sugar Mill, Himalayan Sugar Mill, Eastern Sugar Mill and Reliance Sugar Mill—have cleared all outstanding payments.
Two, Mahalaxmi Sugar Mill and Annapurna Sugar Mill, have made partial payment. Two mills, Lumbini Sugar Mill and Baba Baijunath Sugar Mill, have not paid anything and remain out of contact, department officials said.
“Annapurna Sugar Mill seems to be the most problematic among the non-paying sugar factories,” said a ministry official. Annapurna has paid only Rs30 million out of the Rs420 million it owes to farmers for their sugarcane.
Kapil Muni Mainali, president of the Nepal Sugarcane Producers Federation, said Annapurna Sugar Mill, Shreeram Sugar Mill, Indira Sugar Mill and Lumbini Sugar Mill had not resumed operations. These mills have been in arrears for more than four years.
The farmers who gathered in Kathmandu to launch a protest to get their money have received payment from only Annapurna Sugar Mill.
"Annapurna has paid the farmers but there is no sign the mill will resume operations," Mainali told the Post. He added that farmers had stopped selling their sugarcane to non-paying mills.
Ajit Singh, a sugarcane farmer of Baraudhoran, Sarlahi, said that he had not received any money from Annapurna Sugar Mill. “The factory owner made dozens of agreements to make payment, but it has not happened in four years,” he said. He had become hopeful after the government and the farmers reached an agreement, but he is not so optimistic anymore.
Bishnu Timilsina, deputy general secretary of the Forum for Protection of Consumer Rights Nepal, said he did not expect the mills to clear all outstanding payments by Tuesday as it's a large amount.
“The factory owners do not intend to pay the farmers, and it does not look like they will obey the government order even though they are capable of making payment,” he said. “The government needs to take strict action against the non-paying sugar mill owners,” he said.
The communist government is expected to support farmers, but it is shameful that it has not provided any subsidies to them even though they are burdened by loans, he added.
“The government should not back off this time and take strict action against the sugar mill owners who have not made any effort to make payment,” he said.
Eastern Sugar Mill of Sunsari has cleared all outstanding payments totalling Rs420.3 million by crushing 1.2 million quintals of sugarcane, but it has not paid Rs27 million in government subsidies to the farmers, said Shiva Lal Chaudhary, president of the Koshi Sugarcane Producers Association.
“We have not received the subsidy amount given by the government as per the VAT that farmers have paid,” said Chaudhary. He said that the government had not provided the subsidy amount of Rs65.28 per quintal it has pledged.
Frustrated sugarcane farmers have gradually decreased the sugarcane acreage after not receiving payment for their harvests on time. Farmers in Sunsari, Morang and Jhapa planted sugarcane on only 5,000 bighas while they used to grow the crop on 15,000 bighas previously.