In a significant development aimed at revitalizing sugar cooperatives across Maharashtra, the National Cooperative Development Corporation (NCDC) has approved a margin money loan of Rs 1,898 crore to the state government. This move has been warmly received by cooperative members while drawing criticism from some opposition leaders.
Harshwardhan Patil, the Chairman of the National Federation of Cooperative Sugar Factories, endorsed the government’s decision. He expressed optimism about the impact of the loan on the sugar cane farmers and the overall cooperative movement in the state.
“This has been sanctioned for boosting working capital which will be utilized for sugarcane payments to farmers, salaries of employees, maintenance work, and other operational needs,” Patil elaborated in a telephone conversation with the Indian Cooperative.
The loan features a floating interest rate, with repayment structured over 16 semi-annual instalments after an initial two-year moratorium period. Notable allocations include Rs 350 crore each to the Shree Tatyasaheb Kore Warana Cooperative Sugar Factory in Kolhapur and the Kisanveer Satara Cooperative Sugar Factory in Satara.
Meanwhile, the Ambajogai Cooperative Sugar Factory in Beed and the Rajgad Cooperative Sugar Factory in Pune each received Rs 80 crore.
Additional funding was provided to the Sahakar Maharshi Shankarrao Kolhe Cooperative Sugar Factory in Ahmednagar and the Loknete Marutrao Ghule Patil Dnyaneshwar Cooperative Sugar Factory, receiving Rs 125 crore and Rs 150 crore respectively.
The state government has been tasked with closely monitoring the fund’s utilization to ensure effective implementation. In line with its commitment to the cooperative sector, the Ministry of Cooperation has introduced a ‘Grant-in-aid’ scheme under which the Government of India will allocate Rs 1000 crore to NCDC over FY 2022-23 and FY 2023-24.
This funding is intended to support the establishment of ethanol and cogeneration plants and provide working capital to cooperative sugar mills.
By March 31, 2024, NCDC had sanctioned Rs 3,848.76 crore for 25 cooperative sugar mills. Additionally, the government reduced the GST on molasses from 28% to 5% to further support the industry.
However, opposition parties have raised concerns that the beneficiaries of these initiatives are predominantly cooperatives led by BJP leaders or associates of Ajit Pawar, indicating potential political influences in the distribution of aid.