Interest free loan for sugar mills demanded
LUCKNOW: The Uttar Pradesh Sugar Mills Association (UPSMA) has demanded from the state government interest free loan to the tune of Rs 2000 crore to clear the dues of cane growers. The association has also demanded that the prices of sugarcane be linked to the recovery of sugar.
Speaking to mediapersons, president of the UPSMA CB Patodia on Thursday said high sugarcane prices had crippled the financial condition of the sugar mills. He said the prices had gone up nearly 70% in the past three years while sugar prices increased about 11% only.
Patodia said the condition of sugar mills today was worse than 2006 when the Centre was persuaded to provide interest free loan of nearly Rs 3500 crore. In the past five years, eight sugar mills had closed down, he said.
“We are demanding interest free loan of Rs 2000 crore (about Rs 25 per quintal) now. Out of this, the private sector mills will get about Rs 1600 crore,” he said.
Patodia said the cost of sugar production had reached about Rs 35 per kg in the state against the sugar prices of about Rs 31 per kg. “This was causing heavy losses to the sugar mills. The state govern-
ABOUT THE STATE GOVERNMENT’S POLICY THE ASSOCIATIONS’ OFFICE BEARERS SAID THERE WERE HARDLY ANY POSSIBILITY OF SETTING UP OF NEW SUGAR MILLS AS THE EXISTING ONES WERE FACING BAD TIMES.
ment should consider following the sugar recovery linked prices for sugarcane as was being done in other states like Karnataka and Maharashtra,” he said.
Director general of Indian Sugar Mills Association Abinash Verma said only five states in the country fixed State Advisory Price (SAP). These included Uttar Pradesh, Haryana, Punjab, Uttarakhand and Tamil Nadu. Other states like Maharashtra, Gujarat and Karanataka had never followed the SAP system, he said. There was a need for rationalisation of sugarcane pricing policy. The Centre had circulated the recommendations of the Rangrajan Committee for revenue sharing model for sugarcane prices, he said adding, the state government should consider adopting these recommendations.