Sunday, September 6, 2020

Government cancels contract with fertiliser importers

 Agriculture Inputs Company Ltd (AICL) has scrapped the contract and blacklisted them as the non-perfroming importers failed to import the fertilisers on time.

The AICL had awarded a tender to import fertilisers to Shailung Enterprises and Hobiko Multiple, informed the agriculture minister Ghanashyam Bhusal, organising a press meet at the Ministry of Agriculture and Livestock Development (MoALD) today. “AICL has decided to cancel their contracts and also seize the money they had deposited as collateral,” he said, adding that AICL had signed an agreement with Shailung Enterprises and Hobiko Multiple, on April 24 and 27, respectively with a target of importing fertilisers by May 12. They have kept guarantees worth Rs 48 million each while signing the contracts. The government has also sought to recover the compensation amount from the contractor companies.

According to the agreement, the first shipment was supposed to have arrived within 42 days from the date the agreement was signed and the second shipment within 72 days from the day the agreement was inked. But they both failed to bring fertilisers on time even after AICL extended the deadline by 25 days on their request. “The extended deadline terminated on Saturday but both the companies have not yet provided any update regarding shipment nor submitted any documents,” the minister informed, adding that both the companies will also be blacklisted.

Both Shailung Enterprises and Hobiko Multiple had signed agreements to import 25,000 tonnes of urea, one of the important fertilizers used for paddy production. While Shailung was supposed to import fertilizer from Russia or Oman, Honiko had informed the government that it planned to import the fertilizer from China. The two companies on May 12 opened the letter of credit accounts in Nepal Investment Bank and Siddhartha Bank, respectively.

Bhusal, on the occasion, also expressed his distress in the delay in the import of fertilisers due to the negligence of the non-performing importers of chemical fertilizers. “Despite allocating the budget and awarding the tender on time, the negligence of the contractors has forced farmers to suffer this year too,” he said, adding that the contractors are solely responsible for the delay in fertiliser import and distribution, though there has been some few hurdles created by the Covid-19 pandemic.

The failure of the contractors to import chemical fertilizers on time is feared to bring huge reduction in the production of overall paddy production this year.

Claiming that the action will be an example to the wrongdoers in the future too, he said that the ministry will be vigilant and regulate the agriculture sector wrongdoers. 

There has been two aspects concerning shortage of fertilisers – supply and distribution – but the government has sorted the issues of distribution, he claimed, adding that the supply side used to be a big hindrance for a long time but the ministry has started it out. “In the coming years farmers will not have to face any issues related to fertilisers.”

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