Government finally decides to shut down NTL
Kathmandu, January 29
The fate of government-owned National Trading Ltd (NTL), which remained uncertain after its weak financial performance, is now clear — it will be shut down.
The Ministry of Finance (MoF) has recently recommended Ministry of Supplies (MoS) to shut down NTL, according to Mukunda Poudel, spokesperson for MoS.
“We have received a letter from the privatisation cell at MoF, which is headed by the finance minister, recommending us to shut down NTL soon,” said Poudel.
Following this, MoS has formed a separate committee to hold the due diligence audit of NTL. Once the committee identifies actual property of NTL and its dues to the government, the same committee will table the proposal to shut down NTL at the Cabinet meeting, as per Poudel.
Meanwhile, Supplies Secretary Anil Kumar Thakur said that the MoF recommendation to shut down NTL followed the inability of the government to finalise new operational modality of NTL.
Stating that NTL had been persistently incurring losses and adding financial burden on the government, the latter had introduced the ‘voluntary retirement scheme’ for NTL employees in March last year and all 264 NTL staffers had taken voluntary retirement.
The government had then formed a committee under the coordination of Poudel, who is also the joint secretary at MoS, to study the prospects of operating NTL in different modality.
Submitting its report to the government, the committee had floated five new possibilities for NTL. The options included merging the defunct NTL with Nepal Oil Corporation (NOC), allowing NTL to start fuel trade with China, developing NTL as a supply company of the government, dissolving NTL and developing five-star hotels in its property and developing international standard exhibition halls in the premises of NTL.
However, MoF’s recommendation to shut the NTL means that all doors for re-operating NTL in a new form are now closed, according to Poudel.
The government had established NTL as a public limited company in March 1962 basically to channelise commodity aids from China and the government later transformed it into a state trading firm.
However, NTL had been struggling for financial sustainability in the past few years following years of inefficient management.
As per rough estimation, NTL still owes almost Rs 1.5 billion to the government and various financial institutions.