Sugar firms want to sweeten Bihar

Of the 39 EoIs, 13 had already filed the industrial enterprise memorandum with the Union ministry of industries, which meant they are serious about setting up projects in the state, Nitish Mishra, Bihar sugarcane minister, said.

Mishra said Chief Minister Nitish Kumar's initiative to bring sick and ailing industries back to life with the Centre's help had started yielding results and the incentive package announced by the state had brightened prospects of opening sugar mills and renovating closed ones.

Some of the incentives offered by the government include reimbursement of central excise duty on sugar, exemption of purchase tax on sugarcane, exemption of stamp duty and registration fee on purchase of land, grant of 10 per cent subsidy on capital investment (plant and machinery) to a maximum of Rs 10 crore, whichever is less.

Other benefits to investors who would set up mills with distilleries and ethanol units include exemption from administrative charge on molasses and reimbursement of sales tax (VAT) on molasses.

Sugar mills with co-generation power units would be entitled for exemption from electricity duty on co-generated power. The surplus power generated by these captive units would go to grid stations of the Bihar State Electricity Board (BSEB), sources said.

"With the NDA government's latest initiatives and the Centre's willingness to help boost Bihar's economy the days are not far when Bihar's sugar industry will be back on the tracks and there will be smiles on the faces of thousands of sugarcane growers who are heavily in debt," Mishra said.

Bihar's sugar industry once accounted for 25 per cent of the total sugar production of the country.

Giving details of the 30 EoIs, the minister said some of the major houses which have evinced interest include Coimbatore-based Rajshree Sugars and Chemicals Limited, K M Sugar Mills, Faizabad, Karnataka-based A C M Sugars Limited, Rega Sugar Mills, S K G Consolidated Ltd, Dhaulana Sugar Industries, S B Overseas Limited, Ganapati Sugar Industries (all Kolkata-based), Mumbai-based SED Bajaj Hindustan Limited and Hyderabad-based Pataudia Fabric Processors Limited.

Rajshree Sugars and Chemicals has even submitted its detailed project report to the SIPB for setting up two integrated sugar complexes with an investment of Rs 480.5 crore in two north Bihar districts "" east-Champaran and Madhubani.

The company has also shown interest in setting up another project in Muzaffarpur district and applied for revival of three closed state-owned mills.

Mishra said if all went well the two units of Rajshree Sugars would become operational from 2008 giving a major boost to production in the state. The sugar giant has urged the government to acquire and transfer the land as soon as possible so that it could start execution.

Rajshree Sugars proposed integrated sugar complexes, each having a capacity of 5000 tonnes crushed per day (tcd), which would be expanded to 10,000 (tcd) capacity in phases, a 30-Mw bagasse-based power plant and 60 klpd industrial alcohol plant, thereby helping the state to tide over part of the power crisis, mishra said.

The minister was hopeful that proposals would be cleared by the SIPB soon.