Govt to revive Birgunj Sugar Factory

As part of its bid to reopen state-owned manufacturing industries, the government has appointed Board of Directors (BoD) at the Birgunj Sugar Factory (BSF) to carry out necessary ground works for bringing the factory back into operation.
Ministry of Industry (MoI) has formed ad hoc board under the chairmanship of Dhurba Lal Rajbansi, director general of the Department of Industry (DoI).
"We have been given two mandates," Rajbansi told Republica. "One is to prepare bidding documents to call an expression of interest (EoI) from different private sector agencies to reoperate the factory. The other is to identify ways to manage some 193 former workers of the factory that have denied golden handshake offer.”
The MoI took the step mainly after the Public Enterprises (PE) Board gave its nod to resume the operations of the factory by handing it over to the private sector so that no liability comes to the government. "The board will also calculate the cost of managing the 193 workers,” added Rajbansi.
The factory was closed nine years ago after it started making losses due to problems such as over-staffing and continuous shortage of raw materials -- sugarcane. Though the government had decided to liquidate the factory nine years ago, it had not materialized due to pressure from local political leaders.
Earlier, in 2009, the then finance minister Babu Ram Bhattarai, who is now the Prime Minister, declared that he wanted to see the factory in operation. "We are working on ways to resume operation of the factory as soon as possible," Yam Kumari Khatiwada, joint secretary at the MoI, said.
PE Board, which took the decision to handover the factory to private sector, has suggested the government to manage the 193 workers first. “Dues that the factory owes to the workers must be cleared before handing it over to the private sector,” Bimal Wagle, chairman of the PE Board, told Republica.
Wagle said the government should invite business proposals from interested parties on how they intend to operate the factory. “We have submitted our report to MoI,” Wagle said, adding, “The board formed by the government will now implement the recommendations that we have made in the report."
In March, Agricultural Industry Cooperative, a local entity, had proposed to the government to restart operation of BSF by making fresh investment of Rs 150 million.
Meanwhile, the government is mulling over liquidating the Hetauda Textile Factory (HTF). "Efforts are underway to liquidate the factory," a source privy to the issue told Republica.
Though Madhav Kumar Nepal-led government had decided to liquidate the loss-making entity in 2009, PM Bhattarai then had expressed dissatisfaction over the decision.
HTF was closed eight years ago after it started making losses. Its losses had started to pile up after its products failed to compete with cheaper imports. The factory was employing 1,200 workers.