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Maharashtra State Cooperative Bank hikes pledge loan this crushing season

While the crushing season has already started, confusion still remains among the mills about the payment of FRP.

maharashtra, maharahstra bank, maharshtra corporation bank, maharshtra loan, sugar, sugar value, maharahstra news, india news Due to increase in valuation of sugar, it was decided that for this crushing season, the bank would increase the loan amount from Rs 1,275 to Rs 1,400 per tonne.

The Maharashtra State Cooperative Bank (MSCB), the apex cooperative bank, has decided to increase the quantum of its pledge loan for the present crushing season to help mills pay cane growers the fair and remunerative price (FRP). In a meeting chaired by the chief minister on Wednesday, it was decided that the MSC and other district cooperative banks would release Rs 600 crore this year towards the same.

Pramod Karnad, managing director of MSCB, said that due to increase in valuation of sugar, it was decided that for this crushing season, the bank would increase the loan amount from Rs 1,275 to Rs 1,400 per tonne. The apex bank had increased the valuation of sugar earlier this month given the increase in prices of sugar.

“Although technically this loan is being given to the mills, the extra money would be directly credited into the books of farmers,” Karnad said. For the present crushing season, this loan would result in expenditure of Rs 600 crore for the bank. Karnad added that DCC banks would also be extending this facility to the mills associated with them.

While the crushing season has already started, confusion still remains among the mills about the payment of FRP. The last season had seen many mills failing to pay the FRP to farmers which had led to arrears. As of Tuesday, the arrears stood at Rs 650 crore. The state government has twice announced soft loan packages for the mills to pay the farmers.

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Although the crushing season has started in full swing, most mills are yet to make any announcement or start the process of paying FRP. While mill owners have expressed their inability to pay FRP at one go, farmers’ representatives have demanded for the same.

A special meeting convened by cooperative minister Chandrakant Patil to discuss the issue had remained inconclusive. Patil had talked about arranging for a meeting with the chief minister to discuss the same, which is yet to happen.

First published on: 03-12-2015 at 12:45:19 am
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