​ Maharashtra sugar co-ops demand restructuring of the Rs 3273 crore soft loan

PUNE: Sugar millers from Maharashtra have demanded restructuring of their soft loans. With government trying to control rising sugar prices, millers say that their financial position has not improved yet to start the repayment of the Rs 3273 crore soft loan they had availed during 2013-14 and 2014-15.

Sugar prices have increased by more than 40% during the 2015-16 sugar year. However, mills claim that they have yet not been able to benefit of the rise in rates. However central government has claimed that sugar mills from Maharashtra have been holding sugar in anticipation of rise in prices.

"Sugar prices increased from February. But many mills had sold sugar much below its production cost from October 2015 to January 2016. Government stopped the export incentives scheme. With raids on traders, there is fear in the market and prices have fallen by about Rs 2/kg," said Shivaji Nagawade, chairman, Maharashtra State Co-operative Sugar Factories Federation (Sakharsangh).

The central government had kept a moratorium of two years on repayment of the interest free loan, while the mills had to repay the loan during the next three years. Instead of a total repayment period of 5 years, mills have demanded extension of the repayment period to 7 or 9 years.