February 6: The Salt Trading Corporation (STC) has proposed to the government for increasing the price of salt. STC has proposed for a price rise citing that the corporation is bearing a loss of Rs 350 million annually on its sale of salt.

According to the STC, it is bearing the huge loss as salt is being sold at a lower price than its imported price. "As the loss is increasing yearly, STC has proposed for raising the salt price by Rs 7 per packet (one kg)," said Surya Prasad Shrestha, Joint Secretary and Spokesperson of the Ministry of Supplies.

If the government approves the proposed price, the salt will cost Rs 25 per packet in the domestic market. It costs Rs. 18 in the market now.

According to the STC, the per-packet of salt costs Rs 21 at present while importing from India. However, the STC sells the salt at Rs 16.50 per packet to dealers resulting in a loss of Rs 5 per packet.

"Even though salt comes with an increased price from India, the government does not approve raise in salt price which has caused huge loss to STC," said Kumar Rajbhandari, General Manager of the Salt Trading Ltd. "We proposed an increase in price of 'Aayo Nun'( iodized  salt) three years back, but the government kept mum about the matter."

STC has clarified that if the government provides a grant equivalent to the loss of Rs 350 million, the proposed raise in salt price will be withdrawn. According to a source, STC will make a profit of Rs 1.50 if it increases the price at the moment. However, the corporation might close down due to accumulated loss if the price remains the same.

In order to raise the salt price, Central Monitoring Committee under the Chairmanship of Joint Secretary of the Supply Ministry has to take a decision. According to Rajbhandari, a team of the Ministry is analyzing the issue. The STC transacts salt amounting to Rs. 2 billion annually.

Ministry Spokesperson Shrestha says that a serious study is needed before rising rice as salt is an essential commodity.