Centre to restructure Sugar Development Fund loans
The Centre has launched a flexible personal loan restructuring plan for credit card debt-ridden sugar mills to distinct their excellent total from the Sugar Progress Fund (SDF). The plan provides 24 months of moratorium which the government hopes will assistance it to accumulate a sizeable portion of the dues. As many as 171 sugar mills owed ₹3,052.seventy eight crore to monetary institutions as of October 31.
The stability personal loan total like principal and curiosity will be divided into equal regular monthly instalments for five decades following moratorium period of time, according to the pointers launched by the Food Ministry. Even though penal curiosity will be waived off, mills will have to distinct principal and curiosity, the pointers claimed. IFCI will be the nodal company for non-public mills when the Countrywide Cooperative Progress Corporation (NCDC) is specified for scrutiny of the applications of cooperative mills.
A committee under a joint secretary of Food Ministry will choose the beneficiaries of the plan.“This is a new present only for the ailing mills to distinct the two principal and curiosity. Hope they will get the prospect and distinct their excellent,” claimed a Food Ministry formal. All of these 171 mills, who have defaulted the SDF financial loans, need not essentially deficiency the potential to pay, claimed an sector resource. Thanks to numerous motives they do not distinct their financial loans, the formal extra.
Eligibility
In accordance to the restructuring formula, sugar manufacturing unit incurring “cash losses repeatedly for final 3 monetary decades or if the factory’s internet worthy of is negative” is eligible to apply for personal loan restructuring. The eligibility affliction also says the factories which have not closed down or not stopped crushing cane for more than two sugar seasons can apply for the restructuring.
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Also all those factories which had availed the restructuring of personal loan facility in the previous 3 decades are not eligible to apply this time.
Out of ₹3,052.seventy eight crore default of SDF financial loans, ₹1,627.79 crore was taken by mills for modernisation, ₹1,039.99 crore for co-era unit, ₹260.sixty nine for setting up ethanol vegetation and ₹1,24.31 crore for cane improvement, the formal claimed. Not a solitary corporation in Uttar Pradesh has defaulted the SDF personal loan disbursed to set up ethanol vegetation.
Also, the whole defaulted total features ₹1,249.72 crore as principal and ₹1,060.fifty seven crore as curiosity when remaining ₹742.48 as penalty.
‘Positive development’
“It is a positive improvement and indicates a whole lot for all those mills that are not executing very well for many motives and are not able to repay the bank financial loans and along with the SDF financial loans,” claimed Abinash Verma, Director Common, Indian Sugar Mills Association (ISMA), the apex trade physique.
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For extended time, the sector has been petitioning the Federal government seeking restructuring of the SDF financial loans and waiver or reduction of curiosity for mills that have not been executing very well for many motives, Verma claimed.
The curiosity expenses for SDF financial loans are incredibly nominal and are lessen by two for every cent details when compared to the bank fees.
With inputs from BL Bengaluru Bureau
