: Kerala State Cooperative Consumers’ Federation Ltd. (Consumerfed) will be forced to give up its market intervention plans for the Onam season as its efforts to mop up funds have not yielded result.
Fresh impediments cropped up in executing the decisions of a meeting convened by Chief Minister Oommen Chandy to raise a loan of Rs.25 crore each from six district cooperative banks and provide Rs.100 crore to clear subsidy arrears. The Kollam District Cooperative Bank Employees Union has moved court against the decision to provide loan.
Though the case has been posted for hearing on Monday, the fate of the market intervention initiatives has become uncertain. The government is yet take a concerted action to release the subsidy arrears of Rs.400 crore to the federation. Its festival procurement bill usually goes up to Rs.100 crore.
Earlier, the federation used to bring in rice from West Bengal and Andhra Pradesh for the festival markets. With the payment arrears to suppliers mounting to Rs.420 crore, all major suppliers have decided not to replenish the stock.
The federation owes about Rs.230 crore to suppliers of pulses and Rs.190 crore to those supplying fast-moving consumer goods.
The only option is to clear the arrears and procure goods at competitive rates. On turning to small-scale suppliers, the procurement cost will go up. This would also affect the functioning of the federation, which has 6,149 employees on its payrolls.
Highly placed Cooperative Department sources told The Hindu here that the bad track record of the federation in repaying loans and clearing financial liabilities was the main impediment in securing more assistance.
With the payment arrears mounting to Rs.420 crore, major suppliers have decided not to replenish stock.
