5 of the eight cooperative sugar mills throughout the state, who had been prolonged authorities assure for elevating working capital final 12 months, have neither been in a position to clear the dues of the farmers, nor repay their financial institution loans.
With the September deadline for reimbursement looming, and solely a fraction of the capital being repaid, the federal government is on the lookout for methods to resolve the disaster.
Earlier than the beginning of the 2020-21 crushing season in October final 12 months, 32 cooperative mills, which had been going through issue in elevating working capital from banks, had been recognized by the state authorities for extension of presidency ensures.
The assure permits mills to lift capital from the banks to begin their crushing operations. It was determined at the moment that Rs 516. 30 crore will probably be loaned to the mills, mentioned an official.
Although, given the precarious monetary situation, solely eight of the 32 working mills managed to get the working capital to the tune of Rs 126.78 crore from the banks, the official added.
Until date, Rs 26.09 crore has been recovered from the mill homeowners whereas Rs 114.38 crore nonetheless stays to be paid.
“The working capital was meant to offer the mills with sufficient liquidity to start out the (crushing) season and still have sufficient funds to pay their farmers on time,” mentioned the official.
With 5 of the eight mills not complying with the phrases of settlement, the sugar commissioner, Shekhar Gaikwad, has determined to get better the dues as arrears of land income and has ordered motion within the regard.
“With mills unable to pay their farmers but, probabilities that they’d be capable to repay the remaining loans on time appear distant,” mentioned a senior official from the cooperative division. Failure on reimbursement would outcome within the banks cashing in on the ensures, which might translate into the federal government paying the overdue loans – one other reason behind concern for the authorities. One other approach out that’s being thought of is an extension of the time to repay the loans, or the federal government extending the assure interval.
A month after the crushing season has ended, sugar mills within the state are nonetheless to pay Rs 2,955.55 crore to their farmers. The mills had bought 1014.05 lakh tonnes of cane from farmers for which they needed to pay them Rs 32,143.75 crore in accordance with the government-declared Truthful and Remunerative Worth (FRP) of Rs 2850/tonne. However until June 15, solely Rs 29,188.20 crore has been paid until date.
Of the 190 mills within the state, which had begun operations firstly of the season, 126 mills haven’t any dues. 10 mills have paid simply 40 per cent of their dues and are anticipated to face motion by the sugar commissioner. In the meantime, restoration notices have been issued in opposition to 30 mills.