Orissa sugar industry urges for more credit to cane growers

The representatives of sugar industry in Orissa have asked for a separate line of credit for the sector by the National Bank for Agriculture and Rural Development (Nabard).

Participating in a meeting convened by the Orissa regional office of Nabard to discuss issues related to sugar industry in Orissa, Chairman of Orissa Federation of Sugar Industries, Jagneswar Babu said that to ensure full capacity utilisation of the existing sugar mills in the state, 45,000 hectares of land was needed to be brought under the cultivation of sugarcane against the existing 16,000 hectares.

He added if sugarcane cultivation in 50 per cent of this land was done with bank assistance, the total bank credit required, at a rate of Rs 45,000 a hectare, was Rs 101 crore. He said under the current sugarcane financing arrangement, credit flow to the sector was as low as 20 per cent.

He further suggested that the financial package announced by the Central government for co-operative sugar mills should be extended to the sugar mills in the private sector. Similarly, the term loans availed by the co-operative sugar mills from commercial banks and the government may be considered for restructuring. He said that the interest rate on credit limit should be same as the crop loan.

To ensure monitoring of the credit flow to the sugarcane sector, the State Level Bankers' Committee (SLBC) was urged to prepare a data base on disbursement of loan to the sector. Such a monitoring would enable the bankers and other stake holders to keep a watch on the credit flow to the sector, said Arabinda Padhee, director (agriculture), Orissa government. He called upon the sugar mill owners to strengthen their own research and development (R&D) facilities for supply of better quality of seeds.

S A Kareem, chief general manager, Nabard, said timely and adequate credit to sugarcane growers, bringing more land under sugarcane cultivation, restructuring of the term loans provided to sugar industries, insurance coverage of sugarcane crop and investment credit for sugar complex would bring relief to the ailing sugar industry of the state.

Trailokya Mishra, chairman, Nayagarh Sugar Complex, urged the state government to prepare a road map in line with the policies adopted in states such as Maharastra, Uttar Pradesh and Tamil Nadu for a vibrant sugar industry in the state.

Registrar of co-operative societies, Orissa, K C Mohanty said despite a clear-cut circular by Nabard, the co-opeartive banks in the state were not extending any term loan to the sugar sector.