Agri Business

Uttar Pradesh initiates recovery proceedings against five sugar mills

TV Jayan New Delhi | Updated on August 07, 2021

These mills will be forced to cough up an additional 10% over and above the defaulted amount

The Yogi Adityanath government in Uttar Pradesh, which is about to face an assembly election in six months, has swung into action against five sugar mills which have been “perpetual” defaulters in cane payment to sugarcane farmers by initiating recovery proceedings against them.

Sanjay R Bhoosreddy, Additional Chief Secretary, Sugar and Cane Development, in an official statement issued on Wednesday said that the penal action was initiated against the sugar mills defaulting in cane price payments as even after several notices, these mills were negligent in payment of sugarcane farmers. “As per provisions laid down under Section 17(4) and 18(3) of the UP Sugarcane (Regulation of Supply and Purchase) Act, 1953, recovery certificates (RCs) have been issued against sugar mills for failing to clear the dues of the farmers.”

Defaulting mills

“These defaulting sugar mills are Malakpur-Baghpat (Modi Group), Gadaura-Maharajganj, Chilwaria-Bahraich (Simbhaoli Group), Itimaida-Balrampur (Bajaj Hindustan Group) and Bisauli-Badaun (Yadu group),” he said.

While the Modi group’s Malakpur mill has a capacity of 8,000 tonne crushing capacity per day (TCD), Bajaj’s Itimaida mill 12,000 TCD and Yadu Group’s Bisaulo mill 7,000 TCD. Simbhaoli’s Chilwaria and Gadaura mills can crush 6,000 and 4,500 tonnes sugarcane per day, respectively.

According to a sugar industry source in the State, these mills will be forced to cough up an additional 10 per cent over and above the defaulted amount.

Bhoosreddy said that of the 120 operational sugar mills in the 2020-21 crushing session, 36 had paid 100 per cent cane price for the last crushing season and 29 had made more than 80 per cent payment, while 19 mills had made more than 90 per cent payments.

More mills in the list

A farmer leader, however, said there are many more mills in the State deserve similar action. Citing the case of three mills in Shamli district from where Minister of Cane Development and Sugar Industry, Suresh Rana, hails, he said these three sugar factories — Shamli (of Upper Doab Sugar Mills), Unn (of Superior Food Grains) and Thanabhawan (Of Bajaj Hindustan) — collectively paid only 46.64 per cent of around ₹1,143 crore dues so far.

According to him, the sugar mills in the State crushed sugarcane worth around ₹33,000 crore in the current sugar season, but the payment made so far was only around ₹25,500 crore. In other words, ₹7,500 crore cane payment is still pending. Besides, an interest amount of ₹3,000 crore from the current government’s period as well as ₹5,000 crore from the previous regimes are still pending for payment, the farmer leader said.

On top of that, farmers earned ₹3,000 crore less this year from sugarcane because the yield was less, while the cost of cultivation was higher due to higher diesel price as well as hike in power tariff, he said.

Published on August 06, 2021

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