DoC starts disbursing funds to cooperatives

KATHMANDU, JUN 25 -

The Department of Cooperatives (DoC) has started disbursing the funds allocated for cooperatives engaged in agricultural production. It recently provided Rs 13 million to Prithvinagar Cooperative in Jhapa to establish a tea factory.

The government had announced during the budget presentation that it would provide subsidies to cooperatives to purchase machinery for factories processing agro products.

Prithvinagar Cooperative is the first cooperative to benefit under this policy. Bishnu Ghimire, under secretary at the DoC, said they had provided the first instalment amounting to half of the Rs 26 million approved for the cooperative.

According to the department, it has recently approved the proposals submitted by nine cooperatives seeking subsidies. Four cooperatives involved in betel nuts production and five cooperatives involved in honey production have been okayed by the department. “These cooperatives now have to show matching funds to get the subsidies,” said Ghimire.

Each cooperative involved in betel nut production will get funds in the range of Rs 150,000 to Rs 250,000. The department has approved a total of Rs 1.5 million for the cooperatives engaged in honey production.

The department has drafted a guideline for providing subsidies to the cooperatives. As per the rules, cooperatives seeking grants are required to submit a working plan of their proposed scheme and potential. They have to ensure that at least 80 percent of the raw materials and a similar proportion of the manpower are from domestic sources to be eligible to receive funding.

According to the DoC, the cooperatives receiving grants from the government are not allowed to sell their production plant for the next 10 years. If it is necessary for them to sell the machinery, they will need to get the DoC’s approval.

The DoC has provided Rs 5 million out of the approved Rs 10 million to the National Cooperatives Federation to construct its building. Similarly, it has provided Rs 2.8 million to 14 Central Cooperatives Unions.

The government had announced that it would provide Rs 140 million to the cooperatives and their central union along with the National Cooperatives Federation.

Source: http://www.ekantipur.com/2012/06/25/business/doc-starts-disbursing-funds-to-cooperatives/356135/