Nitin Gadkari’s Purti Group has been under media scanner for the past few weeks. Some reports analysed the filings and financials of the group companies threadbare and concluded all wasn’t well. The corporate affairs ministry and the Income Tax Department have initiated inquiries. However, Gadkari has termed these reports “motivated”, adding he was open to any investigation. Business Standard travels to Ground Zero to unravel the truth behind the documents and numbers, and brings to you the untold part of the Purti story
A small group of farmers has gathered in the dimly-lit gram panchayat office of Bela, a nondescript village with a few hundred families, about 50 km from Nagpur. The group is worried Purti Power & Sugar, an integrated plant at the village that produces sugar, alcohol, fertilisers, power, etc, has come under a sustained media attack, owing to questionable investors, who had allegedly given fake addresses.
However, not many are talking about the investors with genuine addresses —the shetkaris (Marathi for farmers). The majority of the 10,501 Purti shareholders are farmers like Keshav Vasudeva, a tall bespectacled man who holds shares worth Rs 10,000. Vasudeva says he isn’t bothered about the allegations, adding, “Purti has brought us prosperity. Before the factory came up, there was nothing here.”
Another Purti shareholder, Prashant Barapat, who has cultivated sugarcane for the Purti factory in his 4.5-acre farm, says, “Shetkariyon ko bahut fayda hua (the factory has benefited the farmers). We used to grow soybean, wheat and other crops, and the yields would be worth as low as Rs 15,000 an acre. Today, we get up to Rs 70,000 from cane. Without Purti, it would not have been possible.”
Farmers say while Purti has created direct employment for about 1,000 people, 25,000 people across 20-25 villages benefit from the factory. “The factory has put cash in the hands of our people, some of whom have got into the dairy business. Milk and milk-based products are supplied to hotels such as Haldiram’s in Nagpur,” Barapat says.
Barapat, along with others, brushes aside the allegations as politically motivated. “People from the Opposition party have raised these to benefit during the panchayat elections,” says Shankar Ramachandra Ambedkar, another shareholder, who owns shares worth Rs 30,000. While the shareholding is yet to yield any benefit in the form of dividends (Purti is still writing off accumulated losses), it gives the farmers a sense of belonging. “It is a legacy of the cooperative movement,” says P V Jamdar, deputy general manager at the plant, in charge of agricultural development.
A couple of miles away, trucks carrying harvested cane begin arriving at the Purti plant. The 47-hectare campus houses an integrated plant, which includes a 2,500-tcd sugar plant, a 22-Mw power generation plant, a distillery with a capacity of 45,000 litres per day and an ethanol plant with a capacity of 120,000 litres a day. It also has facilities to produce methane and biofertilisers. “We make something out of everything,” a staffer quips.
Procurement is carried out at Rs 1,700-1,900 a tonne, depending on the maturity of the crop. The factory takes care of the cutting and transportation, which works out to an additional Rs 600 a tonne. This year, crushing is yet to begin, as some of the arrivals have been delayed due to seasonal rains. “It is difficult for harvesting machines or labourers to enter the field in standing water,” says Jamdar. Purti has 14 mechanised harvesters imported from Brazil, worth up to Rs 1 crore each. The company sends these harvesters, which can clear up to four acres of cane a day, to farms across the district.
Neutral observers admit to Purti’s success in its catchment area. Kishore Tiwari of Vidarbha Jan Andolan Samiti, a farmer advocacy group, says the Purti model has benefited farmers “wherever water is there”.
“Purti has its catchment area and the factory has helped farmers there. Sugarcane needs a lot of water. In Vidharba, only 20 per cent of the area is irrigated, while 80 per cent is dry land. What can be done about this 80 per cent is what needs to be discussed.”
