After a decade, govt to allow new players in liquor market

The government plans to issue permits to new liquor factories which had been stopped since 2001. The move follows concerns over rising imports and proliferation of foreign products in the market.

There are 15 big and medium-sized liquor factories registered at the Department of Industry (DoI). Among them, 10 are in operation.

In October 2001, the cabinet decided to halt issuing licenses to new liquor manufacturers following strong pressure from the UCPN (Maoist). Since then, the government has also forbidden existing factories to increase their production capacity. The government has also been maintaining a close watch on homemade alcohol.

Secretary Umakant Jha said that the Ministry of Industry (MoI) was planning to issue licenses to new liquor factories to stop the outflow of money due to swollen imports. “Even genuine local products are not getting an appropriate market,” he added. According to the Department of Customs, Nepal imported alcoholic products worth Rs 310 million during the fifth month of the current fiscal year. Liquor imports amounted to Rs 190 million in the whole of the last fiscal year.

Ministry officials said that as liquor items were in high demand and the country was spending millions of rupees on imports, the government should relax restrictions on issuing permits and allow existing companies to expand their output.

“The government will be opening another avenue for revenue collection by allowing interested investors to establish liquor factories,” said an MoI official.

Jha said that the ministry would table a proposal to the cabinet seeking approval for issuing licenses for new liquor factories within a couple of weeks.

Yam Kumari Khatiwada, MoI spokesperson, said that it was not fair to prevent local factories from producing liquor in the name of controlling consumption of alcohol when the country was spending massive amounts on imports.

The government had reopened registration for liquor factories using local fruits as raw material. The move was aimed at utilization of local fruits like apples, sweet oranges and oranges which are produced in large quantities in the country. Local entrepreneurs have also long been demanding that licenses be opened and expansion allowed. “This is also one reason why the government is taking this step towards reopening new licenses and planning to permit factories to increase their output,” said another MoI

MoI officials said it was necessary to reopen issuance of licenses to control rampant illegal production. “Reopening license issuance will allow illegal producers to become legitimate which will ens-ure quality and generate revenue for the government,” said Khatiwada.(Source:ekantipur)

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