Janakpur Cigarette Factory halts production of major brands
JANAKPUR, May 23: Janakpur Cigarette Factory (JCF) has stopped production of majority of its products, citing shortage of fund to acquire raw materials.
The state-owned cigarette producer is in the brink of closure due to long absence of general manager Shyam Prasad Mahato, who is reportedly residing in the capital, from the office.
Mahato has not attended office for the past three and half months following the formation of the new government. He was appointed at the helm of JCF by former Minister for Industry Mahendra Raya.
JCF has stopped production of popular cigarette brands despite their high demand in national and international markets. Sources at JCF said Laligurans cigarette - the production of which was stopped about a year ago - is still in demand at star hotels in the capital. The factory has also stopped production of Kasturi, Sayapatri, Lahure, Yak Premier and Silver-25 - the popular cigarette brands among youths.
“We had to stop productions as we are not capable of placing orders for raw materials,” said Ram Swartha Yadav, deputy director general of JCF.
“We might have to stop productions of Yak, Deurali and Gaida brands in the near future due to lack of raw materials.”
The state-owned cigarette producer has been facing political intervention, especially in the appointment of employees, including chief executive, resulting to mismanagement and lack of accountability among the employees.
To cope with its worsening financial condition, JFC has taken loan worth Rs 270 million from the government, besides arranging additional Rs 720 million by selling its land at New Baneshwar, Kathmandu.
Workers are infuriated with the management, as it has been failing to give a new lease of life to the ailing factory even after the injection of almost Rs 1 billion from different sources. The factory shut productions of major products less than six months after it received capital injection worth Rs 1 billion.
Employees have alleged the management of embezzling the amount received from the sale of land, forcing the factory to close its production. “We need at least Rs 20 million to buy tobacco leaves. But we have no fund to finance purchase of raw materials,” said an employee of the factory.
Ramji Sharma, former employee of the factory, said frequent changes in top management officials due to political intervention has taken huge toll on the factory since the restoration of democracy in 1990.