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Industry Minister plans not to revive Janakpur Cigarette Factory

By Our Reporter
The government has decided not to revive the state-owned Janakpur Cigarette Factory (JCF). The state-owned company was once the leading cigarette manufacturer in the country but has been closed since 2011.  The government currently spends Rs 1 million per day for salaries of its employees and other expenses. The company was built in 1965 with the assistance from the then Soviet Union.
Earlier, in January, the government had announced to revive the factory and was seeking private investors to manage the company but failed to find any buyer. The government has now decided to clear all liabilities and provide compensation to 833 employees of JCF.
Over-staffing and political interference have ruined the famous cigarette factory of Nepal. The Public Enterprise Board (PEB) had recommended handing over the company to the private sector. But there was no one ready to buy it.  It is likely to cost the government Rs 1.5 billion to Rs 2 billion to pay off the staff. JCF’s fixed assets are valued at Rs 10 billion. It owns lands and buildings across the country.
JCF serves as the best example how the politicians have ruined an industry by turning it into a recruitment centre for the activists of their political parties.

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