Sugar co-ops get a Nabard sweetener
Sixty-Eight sugar co-operatives in the state have signed memoranda of understanding (MoUs) with Nabard, the apex refinance institution for agriculture rural development.
By TNN |
PUNE: Sixty-Eight sugar co-operatives in the state have signed memoranda of understanding (MoUs) with Nabard, the apex refinance institution for agriculture rural development. The total revival and restructuring package pegged at Rs 1,850 crore, it is learnt.
Although Nabard had received applications from 91 sugar co-operative mills wanting the revival package, nearly six of them preferred to fend for themselves rather than get involved in the restructuring process. The balance mills are still to complete some documentation formalities. This was expected to happen before the start of the crushing season, ’06-07, which officially began from October 1.
N Srinivasan, chief general manager, Nabard, Maharashtra regional office, said 127 mills had submitted proposals, while Nabard agreed to restructuring proposals of 91 mills. This was done in view of the ability of the mill to repay. “Of the 68 who have signed MoUs with us, only one mill has opted for the full 15-year repayment period,” he said.
The state has 183 co-operative sugar mills, with 50 considered to be sick and 10 in a bad shape. While the sugar co-operatives in the state have been looking for periodic bailouts from the state government, Nabard had stated that this was likely to be the last time a revival package, with stiff restructuring terms, would happen.
The large borrowal accounts will be monitored by the lending banks with Nabard conducting random checks every quarter on banks it considers most vulnerable.The exposure to the co-operative sugar sector of the District Co-operative Credit Banks (DCCBs) and the state’s apex co-operative bank, the Maharashtra State Co-operative Bank, is estimated to be around Rs 7,000 crore.
Although Nabard had received applications from 91 sugar co-operative mills wanting the revival package, nearly six of them preferred to fend for themselves rather than get involved in the restructuring process. The balance mills are still to complete some documentation formalities. This was expected to happen before the start of the crushing season, ’06-07, which officially began from October 1.
N Srinivasan, chief general manager, Nabard, Maharashtra regional office, said 127 mills had submitted proposals, while Nabard agreed to restructuring proposals of 91 mills. This was done in view of the ability of the mill to repay. “Of the 68 who have signed MoUs with us, only one mill has opted for the full 15-year repayment period,” he said.
The state has 183 co-operative sugar mills, with 50 considered to be sick and 10 in a bad shape. While the sugar co-operatives in the state have been looking for periodic bailouts from the state government, Nabard had stated that this was likely to be the last time a revival package, with stiff restructuring terms, would happen.
The large borrowal accounts will be monitored by the lending banks with Nabard conducting random checks every quarter on banks it considers most vulnerable.The exposure to the co-operative sugar sector of the District Co-operative Credit Banks (DCCBs) and the state’s apex co-operative bank, the Maharashtra State Co-operative Bank, is estimated to be around Rs 7,000 crore.
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