Print Edition - 2015-11-28 | MONEY
Govt asks traders to clarify oil price hike
After India imposed a trade blockade on Nepal, edible oil prices have jumped up to Rs300 per litre from usual Rs150-200 per litre
Nov 28, 2015-Amid a flurry of complaints about unnatural hike in the prices of edible oil, the Department of Commerce and Supply Management has sought clarification from traders involved in the business.
In the first phase, the department has summoned KL Dugar Group and proprietor of “Cosmos” brand oil. “We have sought detailed financial reports from the two companies,” said Hari Narayan Belbase, director of the department. “Our technical team will assess the documents.” After India imposed a trade blockade on Nepal, edible oil prices have jumped to up to Rs300 per litre from usual Rs150-200 per litre. Consumer rights activists have accused traders of artificially hiking maximum retail price (MRP) of edible oil.Traders, on the other side, said the prices rose due to increased production costs as raw material prices skyrocketed after the blockade was imposed. Increased demand during the Tihar festival and low supply also contributed to the price rise, they claimed.
KL Dugar Group Managing Director Kumud Dugar said manufacturers were forced to raise the prices due to a hike in the prices of raw materials in India. “The raw material that used to cost IRs7,300 per quintal previously, now costs IRs9,700,” he said.
KL Dugar Group sells cooking oil under Dhara and Sunflow brands. “Besides, increased transportation costs due to the fuel shortages and high detention charges that importers have to pay to Kolkata-based shipping agents are other reasons for the price hike,” said Dugar.
He said the transport fares have increased three-fold, while shipping charges have been raised to $40,000 from $30,000 per shipment. He, however, said the supply was being eased due to slower demand after Tihar.
“The prices are likely to go down by Rs15-20 per litre within a week,” he said, adding they were ready to face any action from government if the black-marketing charge was proven.
There are 14 cooking oil manufacturers in Nepal. Of them, 10 are based in Birgunj, while three are operating in Biratnagar and one in Bhairahawa.
Published: 28-11-2015 09:09