NEW DELHI (Reuters) - The cabinet has approved a scheme of interest free loans to sugar mills, Food Minister K.V. Thomas said on Thursday, as part of a bail-out package to beleaguered mills.
Under the approved scheme, banks will provide interest free loans to help mills to clear cane dues to growers.
Cane crushing in the world's second biggest producer after Brazil started a month behind schedule as result of decline in sugar prices and rising cane rates. The delay has halved the country's sugar output so far.
India started the new sugar marketing year on October 1 with carry-forward stocks of 8.8 million tonnes. It is expected to produce 25 million tonnes this year, larger than demand of 23 million tonnes.
(Reporting by Nigam Prustry; Editing by Ratnajyoti Dutta)
