Privatisation of UP sugar mills on track

Allahabad High Court stay order vacated

The high court stay order on the Mayawati government's move to privatise 28 sugar mills and three distilleries of the Uttar Pradesh Cooperative Sugar Factories Federation (UPCSFFL) has been vacated.

The stay order was imposed in August, following a petition by the shareholders of the mills.

"The Allahabad High Court's stay order has been vacated recently and it has been decided that the state cane commissioner will look after the privatisation of cooperative sugar factories," said a state government official.

In July, the state government decided to go ahead with the privatisation or sale of all the 33 mills and four distilleries belonging to the UP State Sugar Corporation and its subsidiaries. It also planned to privatise 28 mills and three distilleries of the UPCSFFL.

The government had appointed Ernst & Young as an advisor to carry out the privatisation programme. In August, the Allahabad High Court had ordered a stay on the privatisation process.

The bids for privatisation of corporation factories will be invited in January 2008 while the cooperative bids are expected in another three months, he added.

The combined crushing capacity of the 28 co-operative mills is 69,125 tonnes crushed daily (tcd), while that of the 33 corporation mills is 51, 254.5 tcd. Each of the seven distilleries has a capacity of 30 kilolitre a day.

Their combined capacity stands at 210 kilolitres a day. In the 2006-07 sugar season (October-September), the 28 cooperative mills crushed 10,598,000 tonnes of sugarcane to produce 912,000 tonnes of sugar while the corporation mills crushed 49,54,000 tonnes sugarcane to produce 415,000 tonnes sugar.