Heads of sugar companies in Tamil Nadu and South Karnataka met with Prime Minister Narendra Modi recently to seek the Centre’s assistance to settle mills’ dues to farmers.

A delegation of the South Indian Sugar Mills Association met with the Prime Minister for support in rescheduling loans. It also sought help to smoothen out supply of ethanol to public sector oil companies by Tamil Nadu mills, to enable them to participate in the ethanol-blended fuel programme.

Palani G Periasami, President, SISMA-TN, said as opposed to the overall sugarcane glut in the country, Tamil Naduhas been facing an acute sugarcane shortage over the last few years due to drought. The situation is similar in South Karnataka, he said. Therefore, the support announced by the Centre to address oversupply in the domestic market do not address the problems in the region. He said the industry is relieved that the Prime Minister has agreed to consider specific measures to help mills pay farmers’ dues. A representative said addressing ethanol supply issues here and allowing import of molasses from UP is critical for mills in the State. Periasami, along with Ram V Tyagarajan, CMD, Thiru Arooran Sugars; Rajshree Pathy, CMD, Rajshree Sugars; N Ramanathan, MD, Ponni Sugars; M Manickam, CMD, Sakthi Sugars; and Srinivasan MD, Chamundeswari Sugars, were among the delegation that met Modi.

He said the industry is thankful to the Union Minister Nirmala Sitharaman and Pon Radhakrishnan for their support.

Mills in Tamil Nadu have been working at just 20 per cent of capacity in the 2017-18 (October-September) season. Capacity utilisation has dropped steadily year by year from 50 per cent in 2013-14.

Mills in the State owe sugarcane arrears of about ₹200 crore in the current season (as of June 15). They also had about ₹540 crore in sugar-industry-specific loans from the government and about ₹3,200 crore in bank debt.

Periasami pointed out that the State utility owes mills about ₹108 crore for power supplied from co-generation. Measures to allow co-generation units operate during the off season are also being taken up soon with the authorities concerned.

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