Govt plans to hike price of iodised salt

Kathmandu, February 1

The government is planning to hike the price of iodised salt due to the loss that Salt Trading Corporation has been bearing because of increased purchasing cost.

STC — the government-owned enterprise — recently wrote a letter to the Ministry of Supplies seeking permission to increase the price of iodised salt, which costs Rs 18 per kg in the retail market. In the letter, STC said it had been facing loss in salt business following increment in import and transportation cost and rise in government allowances in recent years. The government had last increased the price of salt in 2013 by Rs 3 per kg to Rs 16 a kg.

“Import cost of salt has risen significantly in the last couple of years following a surge in transportation cost. Similarly, the increment in allowances to government staff last year has added to the loss that STC is incurring in salt trading,” said Urmila Shrestha, general manager of STC. According to her, STC’s annual loss in salt business has ballooned to an average of Rs 20 million in the recent years.

“At this stage, increasing the price of salt is the only way to protect STC from turning into a debt-ridden institution. The government should either allow STC to raise price of iodised salt or compensate STC for the loss that the corporation is facing currently,” Shrestha added.

STC officials say that the price of iodised salt needs to be increased also to prevent possible smuggling of salt across the Indian border areas where price of iodised salt is comparatively higher.

According to Shrestha, one kilogram of salt costs between INR 16 and INR 21, depending on different states in India, while iodised salt costs Rs 18 in Nepal. According to Shrestha, price of salt is higher in India because of taxes, private sector’s investment in business promotion activities and high commission amount that companies need to pay at different layers of the distribution channel. In Nepal, STC has a monopoly in salt trading. Meanwhile, MoS is still studying the proposal of STC. “The high-level price fixation committee of MoS will study the proposal of STC soon and will allow STC board to increase price if necessary,” said MoS Secretary Prem Kumar Rai.

STC statistics show that almost 160,000 tonnes of iodised salt is consumed in Nepal on an average. STC imports salt from Gujarat.

LPG dearer by Rs 25 per cylinder

KATHMANDU: Nepal Oil Corporation has increased the price of liquefied petroleum gas by Rs 25 per cylinder with effect from Thursday midnight.

Following the adjustment, LPG will cost Rs 1,350 per cylinder. “Indian Oil Corporation has raised its price for Nepal for February,” said Bhanubhakta Khanal, spokesperson for NOC, adding that increased prices of petroleum products in recent months have increased NOC’s losses.

According to Khanal, NOC will face a loss of Rs 162.91 on the sale of each LPG cylinder as per the new rate forwarded by IOC. NOC will have to bear a loss of almost Rs 160 million on cooking gas in February as per the new rate, he said. NOC, however, has not adjusted prices of other petroleum products. Khanal said that IOC had added nine paisa per litre on petrol, one paisa per litre on diesel and Rs 1.73 per litre on kerosene for February.

According to prices of petroleum products for February, the projected loss of NOC for the first half of the month is Rs 240 million.