INDIA: Minister meets with farmers amidst mill drama

Published: 12/07/2017, 10:01:10 AM

The Legislative Assembly on Wednesday evening witnessed high drama after All India N.R Congress legislator T.P.R Selvam tried to take in a tractor carrying sugarcane farmers to the Assembly for a consultative meeting convened by Social Welfare Minister M. Kandasamy, according to India's Hindu newspaper.

Security guards closed the gates as the MLA tried to take the vehicle inside after driving from the New Bus Stand area to the Assembly.

As the farmers started shouting slogans against the closure of Lingareddipalayam Sugar Mill, Kandasamy came to the gate and asked the security guards to allow the farmers to take the tractor inside the Assembly.

Conceding to the request of farmers, Kandasamy also boarded the tractor while the vehicle was taken inside the Assembly premises.

The Minister had invited the farmers to clarify the government position on the mill after sugarcane growers raised apprehension about the government plan to privatise the mill.

A senior official told The Hindu that the cabinet did not take any decision to close the mill. The mill, which has been closed for the last several months, had an accumulated loss to the tune of around INR2.00 billion (US$31 million).

Apart from the accumulated loss, the mill has financial liabilities to the tune of around INR1.18 billion, including loans taken from banks and financial institutions.

The mill owes around INR170 million to the Pondicherry Distilleries Limited, INR150 million to Pondicherry State Co-operative Bank, INR180 million to Pondicherry Industrial Promotion Development and Investment Corporation Limited and INR80 million to Pondicherry Power Corporation Limited.

Besides, the mill has to repay INR210 million to farmers for supply of sugarcane and INR310 million as salary to its workforce totalling around 400.

The mill, according to the official, was running with a budgetary grant from the government. The annual grant from the government ranges between INR200 million to INR220 million.

The government while leasing the mill to a private player was also planning to introduce an attractive Voluntary Retirement Scheme. The government would bear the financial liability for the VRS scheme, the official added.

"We have almost come to a decision that in the present form, the government will not be able to provide budgetary support every year. Before the mill goes the Anglo French Textiles way, a viable decision has to be taken. The consultation meeting is to explain the position," said a senior official.