Cash crunch at Consumerfed

Thiruvananthapuram: Consumerfed MD Tomin J Thachankary has written to the state government expressing disability to start Onam markets as the Government has given only Rs 15 crore as against Rs 100 crore needed for purchasing essential commodities.  

Consumerfed usually opens 1,500 Onam markets across the State. The crisis was due to the failure of the Government to release the subsidy arrears of Rs 400 crore due to Consumerfed. Earlier, Consumerfed did not conduct Ramadan and Vishu fairs also due to financial constraints.

Though, an earlier meeting convened by Chief Minister Oommen Chandy decided to raise a loan of Rs 25 crore each from six district cooperative banks and give Rs 100 crore to clear subsidy arrears, this could not materialize because of opposition from the banks.

Normally, Consumerfed bring rice from West Bengal and Andhra Pradesh for the festival markets. As they had payment arrears of around Rs 420 crore, suppliers had refused to provide the stocks.

Consumerfed had started discussions with the suppliers in the hope of receiving the help from the Government.

Consumerfed is making losses to the tune of Rs 1,100 crores. Apart from Rs 420 crore dues to distributors, Consumerfed has also taken loans of Rs 580 crores from various financial institutions and has been forced to pay interest of Rs 300 crore.