UP assembly clears sugar mills' selloff

The Uttar Pradesh assembly unanimously approved the privatisation of 24 loss-making sugar mills of the UP State Sugar Corporation here today.

The proposal was moved by Chief Minister Mulayam Singh Yadav, which was adopted by the House. Of the 24 mills, five are closed, eight are in losses, while the remaining eleven are surviving on liberal government doles.

The chief minister said he had moved the proposal for seeking the support of the assembly since his government's earlier attempt to privatise the mills was scuttled by vested interests.

"Baseless allegations were made," he said, adding that "an effort was made to get the CBI to probe the matter, which forced the industrial houses to backtrack because none was ready to face the probe by the central agency''.

The Shekhar Bajaj group was the forerunner in taking over the 24 mills. The group had submitted tender documents, along with Rs 5 crore earnest money, for acquiring the mills. It recently applied for the withdrawal of the money.

The Bajaj group is setting up five sugar mills in UP, with the crushing capacity being 5,000-10,000 tonnes crushed a day.

Without naming the party or the person, Yadav said a complaint seeking CBI probe was made to Prime Minister Manmohan Singh.

"The PMO, without making any inquiry, referred the letter to the UP government, and it has now been annexed in official files," he added.

Yadav said the controversy surrounding the privatisation of the sick mills had made the task difficult, because no investor was interested in putting his money in a controversial deal.

"That is why I want to seek the opinion of the members of the House before the government decides its next move in this regard,'' he added.

Listing the sequence of events for the privatisation of the 24 sugar mills, he said his government had adopted a transparent process.

"The Allahabad high court had validated the deal. The Board of Industrial and Financial Reconstruction and the Appellate Authority for Industrial and Financial Reconstruction had also ruled in favour of the government, and yet charges were made against my government and our party leaders by some opposition leaders."