FinMin talks tough against crusher plants

- POST REPORT, Kathmandu

Aug 26, 2014-

Finance Minister Ram Sharan Mahat said on Tuesday that the government would not allow crusher factories to operate wherever they wanted as it follows up on moves to shut down plants not meeting set standards triggering protests from factory owners and other entrepreneurs.

Since mid-July, the government has barred stone crusher factories failing to meet set standards from operating. The plants are required to be situated 500 metres away from highways and rivers, and 2 km away from forests, national parks and human settlements.

As a step to conserve forests, the government has also banned extraction and export of natural resources from the Chure region completely.

“Many crusher industries have not followed the set standards, and the government cannot allow them to operate as they pose a risk to vital infrastructure like bridges and are contributing to environmental degradation,” said Mahat, speaking at an interaction organized by the Federation of Nepalese Chambers of Commerce and Industry (FNCCI). “We can lift the ban only on those crusher industries that comply with the government norms.”

Currently, a halt in supplies by crusher factories despite adequate stocks with them has led to shortages of sand, pebbles and stones. The construction of development projects and private houses has been hit as a result.

Prices of construction materials have soared as the government has failed to take action against those creating the artificial shortage. Government sources said that the factories had an estimated 4 million cubic feet of construction materials in stock. Although the government last week directed them to sell their existing stocks at least, they have refused to do so.

Earlier, Jayaram Lamichhane, president of the Federation of Contractors’ Associations of Nepal, had urged Minister Mahat to annul the ban arguing that it had affected almost all the construction activities including national priority projects. On Sunday, tipper operators parked around 700 trucks at Tinkune as part of the first phase of their protest against the government’s ban on crusher factories.

According to Mahat, the government has delegated complete authority to the local bodies to monitor the crusher factories. “The government can rethink the ban if the district monitoring committees recommend lifting it,” he said.

Mahat also said that the government could not raise the threshold of the business as demanded by the private sector to avoid even bigger VAT defaults.

Currently,  traders doing annual transactions of less than Rs 2 million do not have to register with the VAT office, but the private sector has been demanding a hike in the threshold citing rising prices in all the sectors. A government probe conducted a few years ago against the use of fake VAT bills has revealed the scope of tax evasion through this method.

During the interaction, Mahat also expressed the hope that the much awaited power trade agreement (PTA) with India and the power development agreement between the Investment Board of Nepal and India’s GMR Company would take place soon.

Businessmen participating in the interaction made a number of demands like giving more incentives to small and medium enterprises and low-interest loans for the productive sector. They also complained at the “high-handedness” of the tax authorities and increased import duty on textiles besides demanding the implementation of an online payment system.

 

Published: 27-08-2014 10:59

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