Maharashtra co-operative fraud: Endgame for co-operative sugar factories?

Of the about one hundred seventy five registered co-operative sugar factories in Maharashtra, only ninety five crushed cane in the 2020-21 sugar year. More than 54 for each cent of co-operative mills remained dysfunctional.

Administrators of greater part of the mills say that they will not be in a position to start crushing upcoming year owing to the enormous losses incurred.

In 2018, of the 178 registered co-operative sugar mills, only one zero one began crushing functions. Of these 80 claimed a overall loss of ₹4,one hundred seventy five crore. In 2019, of the 102 working mills, 59 mills claimed a loss of ₹2,474 crore.

The overall financial gain earned by the remaining mills in 2018 and 2019 was a meagre ₹188 crore and ₹399 crore, respectively. In the 2020-21 year, mills forecast much more losses and lower financial gain margins.

Study also: Maharashtra co-operative fraud: How co-op sugar mills develop into non-public attributes

Now, fifty seven co-operative sugar factories have expressed incapability to repay loans of about ₹3,000 crore taken from Maharashtra State Co-operative Bank (MSCB), Mumbai Bank, and Nanded and Osmanabad District Central Co-operative Banking companies. The State government, a guarantor to these loans, has set up a committee to draft an motion system for the mortgage payment.

In 2020, the Maharashtra government passed a resolution to body criteria to rejuvenate non-operational sugar mills and their allied models on a employ the service of, partnership or collaboration foundation.

Change to non-public method

A senior government official explained that both the State government will have to repay the personal debt or the banking companies will have to auction the mills.

“All these mills are dominated by politicians, who also have a say in the government and the banking companies. So, it is their conclusion on what they want to do with these mills.

“It is not just about mills, but also their handle on enormous land parcels that the mills have obtained at a subsidised price tag,” he explained.

Study much more: How politicians are pocketing sugar mills and their large lands

A previous director of Sangli-based mostly Vasantdada Co-operative Sugar Mill, 1 of the oldest in the State, explained the manufacturing unit is remaining run by a non-public corporation as the directors failed to spend lender personal debt. The mill stands on a sprawling 400 acres in a prime locality in Sangli city and has land parcels in other destinations.

“The injury brought about by mismanagement, corruption, overstaffing, absence of experienced technique and the higher cost of doing the job cash is enormous. Co-operative sugar factories in the State are on the deathbed. In the upcoming couple several years, there will be much more non-public factories working in the State in comparison to co-operative mills,” he explained.

About 164 mills crushed sugarcane in 2010-11. Of these, the variety of non-public mills was forty one (25 for each cent). In the not too long ago-concluded 2020-21 sugarcane year, out of the a hundred ninety working mills, ninety five (fifty for each cent) were non-public mills.

Bitter politics

All farmer leaders say that sugar barons have looted farmers and fuelled their possess political ambitions by working with the co-operative revenue for elections.

They say that mills make losses not since they have to spend better Truthful and Remunerative Value (FRP), but since of mismanagement. Co-operative mills and sugarcane farmers in Maharashtra have routinely locked horns over the timely payment of the FRP.

Just forward of the 2019 State elections, numerous sugar sector bigwigs, who savored electricity in the Nationalist Congress Bash and Congress regimes, joined the BJP camp sensing the direction the wind was blowing. Numerous contested and even received as BJP candidates.

“As the Enforcement Directorate has initiated a probe from mills and the Centre has recognized a new Ministry of Co-procedure under Amit Shah, numerous sugar barons who are under the scanner may shift their loyalties to the BJP,” suggests political observer Mohan Patil.

Nationalist Congress Bash (NCP) President Sharad Pawar, who one-handedly controls Maharashtra’s sugar politics, not too long ago achieved Key Minister Narendra Modi about the ongoing turmoil in the State’s co-operative sector. This is probable to be the commencing of a new political realignment in Maharashtra.

Soon after all, the BJP is not in a position to digest the actuality that Maharashtra has slipped out of its fingers irrespective of remaining the one greatest occasion the Assembly and the NCP can not manage to place its sugar satraps under the ED scanner, Patil included.

Element one of the series: How politicians are pocketing sugar mills and their large lands

Element two of the series: Maharashtra co-operative fraud: How co-op sugar mills develop into non-public attributes

This is the remaining portion of a a few-part series