The parliamentary Industry, Commerce and Consumer Welfare Committee on Tuesday directed the Ministry of Industry (MoI) to scrap the decision made by the Industrial Promotion Board (IPB) to issue new liquor manufacturing licences for the time being.

The IPB headed by Industry Minister Mahesh Basnet had made controversial amendments to the standard for liquor factories before deciding to issue new permits.

The IPB’s decision has been criticized as being hurried and untimely since the country has been grappling with a political crisis and a new government is yet to be formed. The decision had opened the way for new licences besides allowing the existing companies to upgrade and expand.

“The decision does not seem to be much important at this time. Liquor isn’t an essential commodity. Hence, we feel that further study is needed on the matter,” said Bhisma Raj Aangdembe, chairperson of the House committee. “Hence we have directed the MoI to halt the process for the time being.”  

“Holding discussions on whether to issue new manufacturing licences seems to be inappropriate in the present context. There is a need for thorough study as liquor is not an essential commodity. There is also a need to monitor the existing liquor companies and wait for a decision on the fate of the companies which had acquired permits but did not go into operation,” the committee said.

After a number of companies failed to fulfill the government standards to obtain licences a few years ago, the issuance of new permits was halted. The government had set tough new standards for alcohol production after the market became flooded with substandard products. As many as 26 companies had failed to obtain licences after the new standards came into effect. As liquor manufacturers were unable to abide by the provision, the issuance of licences was halted. Subsequently, the Department of Industry (DoI) had recommended to the Cabinet to take action against them. However, nothing has been done so far.

According to the DoI, the Cabinet has not made a move as the time limit for the liquor manufacturers to obtain licences has not run out. The deadline will expire in December. According to the DoI, the decision to issue new licences was taken after amending the standards.

The government had decided to halt the issuance of new permits till the standards could be amended, said a source. “This is a regular process, and new licences have been opened as we now have new standards in place.”