Farmers’ organisations have opposed the state government’s decision to allow financially troubled cooperative sugar mills to hand over their by-product projects to private investors under the Build-Operate-Transfer (BOT) model.
The move would weaken the cooperative movement instead of strengthening it, said farmer leaders. They pointed out that sugar mills are already under financial strain due to rising management costs, salaries, Fair and Remunerative Price (FRP) payments to farmers, harvesting and transport charges, and chemicals. Many mills and their by-product units are struggling to remain viable.
Despite these challenges, the government has adopted a policy permitting private investors to take over projects related to power generation, alcohol, compressed biogas (CBG), and biogas. Farmer representatives alleged that this would effectively transfer valuable assets built by cooperatives into private hands.
Swabhimani Shetkari Sanghatana leader Raju Shetti criticised the decision, alleging that cooperative mills are first pushed into financial distress and then opened up to private control. He claimed that the new government resolution allows private players to take charge of by-product projects set up on cooperative land and infrastructure, without adequate safeguards for farmers.
Farmer leader Raghunath Patil said earlier policy changes had already reduced farmers’ share in by-product earnings when the pricing system shifted from SMP to FRP. He described the latest policy as another step towards privatisation. Patil warned that if sugarcane growers do not benefit from mills and related projects, they may shift to other crops, which could eventually impact market prices.
Yashwant Deshmukh, state president of the Kisan Sabha, questioned the decision to allow project approvals without placing them before the annual general meeting. He said farmers are the owners of cooperative mills and should have the final say in such matters. He demanded that the government withdraw the policy.
As per existing norms, any expansion project requires approval from the annual general meeting of members. However, under the new policy, by-product projects under the BOT model can be cleared by the board of directors without convening the annual meeting. The authority to extend contract periods has also been vested in the directors.
