Madurantakam Cooperative Sugar mill has recommenced operations after more than a decade.

According to official sources, the sugar mill at Madurantakam, about 75 km south of Chennai, has started trial production on Thursday. The mill, whose operations were suspended in 2001-02 due to financial constraints and cane shortage, is expected to crush about 50,000 tonnes of cane in the current season.

The refurbishment of the mill was formally launched last October by the Deputy Chief Minister, Mr M.K. Stalin, with financial assistance by the State Government.

Recommencement cost

According to a Government Order last year, of the estimated Rs 33.50 crore for the recommencement of operations, the State Government has sanctioned Rs 18.45 crore as a ten-year term loan including Rs 5.88 crore for 2010-11 and Rs 12.57 crore for 2011-12.

It has granted a moratorium on interest payment for three years or earlier if the mill's operations are profitable.

The State Government has waived penal interest of Rs 6.92 crore on Government loans, frozen interest charge on existing loans till the mill turns a profit and also waived Rs 15.05 crore dues to the Commercial Tax Department.

Litigation

The order said the Government had earlier hoped to revive the mill on a Lease, Rehabilitate, Operate and Transfer basis with private sector participation. But this had met with stringent opposition from the farmers and the matter had been taken to court.

Following an order of the Madras High Court, the authorities organised a special general body meeting in January 2010 in which the members opposed the “LROT” and resolved to retain the mill in the cooperative sector.

There are 16 mills in the cooperative sector and three mills in the public sector in Tamil Nadu.

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