Five closed sugar mills in state likely to be opened soon
PATNA: About five closed sugar mills in the state are likely to be opened this year as private companies have shown interest in their revival. As of now, nine sugar mills are closed while six were taken over by private companies last year.
“Two of them are operational at Lauria (West Champaran) and Sugauli (East Champaran) which were leased to HPCL Biofuels Ltd,” said principal secretary, industries, C K Mishra.
The government has been trying to lease out all the nine shut sugar units, but official sources said that parties showed interest only in four or five units. The sugarcane department invited bids thrice for the private takeover of the nine closed mills, but the first two attempts evoked little response. Again in November last, a fresh bid was invited for the revival of the closed sugar units, including one distillery.
These nine closed units are located at Hathua, Banmankhi, Warisaliganj, Goraul, Samastipur, Guraru, Lohat and two in Siwan. The bids were invited for long-term lease of 60 years, renewable for another 30 years. “About 35 private companies have submitted their tenders with their proposal,” said sources.
Mishra said that once the takeover is finalized for the four or five closed mills, the rest will be taken over by the Bihar State Infrastructure Development Authority. Last year, six closed units of the corporation had been taken over by private companies. While two of them were made functional, two others will start functioning from this year while the remaining two units will be used for purposes other than sugar manufacturing, he said.
The revival of these closed mills will not only help the cane growers, but also ensure arrear payment of the staff who are going without salary for years. As per a rough estimate, these closed mills owe about Rs 200 crore to their employees.
Apart from Lauria and Sugauli for which HPCL deposited altogether Rs 95 crore as lease money, four other closed units were taken over last year. The Motipur unit was taken over by India Potash Ltd for Rs 56.20 crore, Bihta unit by Prestine Logistic & Infra Projects for Rs 23.16 crore, Sakri and Raiyyam units by Tirhut Industries for Rs 18.25 crore and Rs 8.44 crore respectively.
All these sugar mills, which were under the Bihar State Sugar Corporation, were closed one by one in early 90s mainly due to mismanagement as well as obsolete equipment and inadequate skills. This corporation was established in 1974 with a purpose to take over all the private mills to modernize and make them more viable.
The government took over 15 mills at Banmankhi, Lauria, Hathua, Sugauli, Motipur, Samastipur, Sakri, Lohat, Raiyyam, Siwan, New Siwan, Goraul, Warisaliganj, Bihta and Guraru. But the Corporation failed in its purpose and all the mills were shut down.
Since 2005, a reverse policy has been adopted: to invite private companies to take over the government controlled mills. Once Bihar was a prominent sugar manufacturing state in the country.
However, of the total cultivable area of 54 lakh hectare, only 2.30 lakh hectare approximately 4.5 percent, is under cane cultivation whereas in neighbouring UP 70 percent of the cultivable area is under cane coverage.
The present sugarcane production of the state is around 1,26,000 metric tonnes of which 1,00,000 metric tonnes is being sent to other states.
Mishra said that about 14 proposals for opening new sugar mills worth Rs 3,606 crore have been received by the State Industrial Promotion Board and most of them have been approved by the cabinet.