Cooperative banks have more than Rs 5,700 crore exposure to sugar mills

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Lucknow: During the 2018-19 crushing season, Cooperative banks in the major sugar-producing state, Uttar Pradesh, had an exposure of Rs 5,747 crore to the sugar Industry. Under various central and state government schemes, Rs 4,492-crore as regular loans and Rs 1,255 crore as soft loans were provided to sugar mills.

Mukut Bihari Verma, UP cooperative minister, claims cooperative banks have made a significant contribution in tackling the problem of farmers’ arrears by giving loans to mills.

Few months ago, the government announced a soft loan of up to Rs 10,540 crore to the sugar industry to help mills clear mounting arrears to cane growers.

According to the reports, sugar mills in Uttar Pradesh owe sugarcane farmers around 9,792 crore till July 16. UP CM Yogi Adityanth had warned sugar mills of strong action in case of non-payment of sugarcane dues. He had stated that the delay in clearing the arrears of sugarcane farmers would not be tolerated and directed the officials to ensure that sugar mill owners make the full payment of sugarcane farmers by August.

The government had introduced various measures, including a soft loan scheme, hike in the minimum selling price of sugar and others to help sugar mills clear mounting cane arrears. But, millers failed to clear it, citing surplus sugar and depressed sugar prices.

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