Dairy Industry Demand Concessional Loans For 5 Years

May 26, 2020 | Investopaper

Nepal Dairy Association has demanded the announcement of relief package by including the serious problems in the dairy sector in the budget and program of the coming Fiscal Year 2077/078 BS. Stating that a request has been made to the concerned body through the National Dairy Development Board for relief, the association made its demand public by holding a press conference through video conference on Monday.

According to Prahlad Dahal, general secretary of the association, 80 percent of the market has been lost due to the ban on dairy products during the main season. It is estimated that a loss of Rs 5 billion will be added when the powdered milk and nauni stockpiled for season expire.

It has been demanded to provide soft loan to the dairy operators for five years on the basis of the certificate of the industry. Similarly, the term loan previously taken by the industry should be increased for two years and the interest for the period should be waived, 50 percent discount on electricity and 50 percent discount on VAT should be re-imposed.

According to the demand letter, the government should provide subsidized loan and give priority to the new industrialists. The limit of the subsidized loan should by increased from Rs 50 million to Rs 100 million.

Dairies affiliated to the association had distributed milk and milk products free of cost during the shutdown. Milk and ghee were also distributed free of cost to the traffic police and midwives from the quarantine set up at various places.

Loss of three billion rupees

According to the dairy operator, more than three billion rupees has been lost in the two months since the shutdown began. As per the Dairy Association, the consumption of milk has dropped to 20 percent in recent times as most of the people living in the urban market areas have returned to the village due to lockdown. The expiry of the stock of dairy products has added another concern to the dairy operators who have suffered losses due to the ban on dairy products in the main season.

As per the statistics of the Dairy Association, out of the 6.2 million liters of milk produced daily in Nepal, 17 percent is consumed in the formal sector and 33 percent in the informal sector, while 50 percent is consumed by the farmers themselves.


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