THIRUVANANTHAPURAM: Supplyco is facing the embarrassment of being blacklisted by private firms in neighbouring states.

Suppliers in Tamil Nadu, Karnataka and Andhra have decided not to deliver supplies to Supplyco, which has not paid for the Rs 700 crore worth of food items they delivered. The goods are delivered by 182 suppliers and most of them are from these three states.

Traders of the three states will meet next week to formally approve the decision and inform the government. The traders are also planning to approach the court demanding the money including the interest if they do not get at least half of the 700 crores. The amount due is from last March.

The distribution was stopped last July when the amount crossed 600 crores. Outlets started running out of stock in early August. The Onam markets went off without a hitch after Minister GR Anil intervened and a compromise was reached. 120 crores were paid to the distributors before Onam. The goods were delivered with the assurance that the government would pay the balance immediately. That promise was not kept.

Distributors' business is also in trouble

Most of the suppliers are delivering rice and other staples in the general market as well. They also have other suppliers who supply them. Their business is also suffering as they did not get money from Supplyco. Supplyco owes Rs 32 crore to Hafsar Trading Company in Thiruvananthapuram alone. With the shortage of money, they are unable to pay the small distributors. They are not delivering the goods. Rahim, the owner of Hafsar Trading Company, said that if this continues, the traders will be in debt.

SupplyCo facing crisis

• Earlier, up to 10 crores of trade was done daily
• Only Rs 3.31 crore worth of sales took place on Thursday
• Education department should pay 200 crores immediately, says food department
• The finance minister has to decide to pay this amount

Supplyco should be paid

Market intervention: 1525 crores

From Education Department: 200 crores

For Kit distribution: 158 crores