The state government began leasing its closed mills to private companies since 2008. So far, the government has been able to lease out its 8 of its 15 closed sugar mills to different companies. Impressed by the success, it started the process for leasing out of the remaining mills in May, 2012. SBI Caps was appointed as financial consultant to facilitate the process. However, no investor came forward for these mills and the state government decided to postpone the process till February this year.
However, it has now decided to again postpone the process. "The SBI Caps advised against going ahead on the process," Sudhir Kumar, Principal Secretary of the Sugarcane Development Department told Business Standard, "They told us that the prevailing economic conditions are not favorable for bidding. If we go ahead with it, we will not receive as good response as we expect. Therefore, we have decided to postpone the process. We may reinitiate the process in next financial year."
However, if the sources are to be believed, the lack of investors also played a big role in this delay. One of the officials associated with the process told, "Investors are interested in buying these mills. The bigger mills have already been taken. The remaining mills have very small land holdings, which does not suit their needs. We have tried to lease them out in earlier phases too, but nobody came."