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HomeIndustry & UpdatesKarnataka government asks Centre to relax lending norms to sugar factories

Karnataka government asks Centre to relax lending norms to sugar factories

Karnataka on Wednesday requested the Centre to liberalise banking norms to extend loan to ethanol units and existing sugar factories to overcome the financial crisis due to low sugar price and Covid-19 pandemic.

Sugar and Textiles Minister Shankar B Patil Munenakoppa, who met Union Commerce Minister Piyush Goyal here, said that ”due to low sugar price for the past 4-5 years, coupled with Covid-19 pandemic, sugar factories have not generated expected revenue leading to poor balance sheets which eventually affecting their loan borrowing. To help them, flexibility should be given in providing loans.”

The state minister also requested the Centre to extend the export subsidy to sugar, which was announced during last year by Centre, to this year also.

He also requested Goyal to shift the execution of the drip irrigation subsidy distribution programme from the existing Department of Agriculture to Commissioner for Cane Development and Director of Sugar.

He also requested the Union Minister to take steps to ensure oil marketing companies clear the bill for supplying ethanol by 7 days instead of existing 21 days. The ethanol units have also requested for early finalisation of supply and lifting of ethanol, which will help them with continuous production and supply, the state minister brought to the notice of Goyal.

Since Karnataka is a major sugar producing state with 70 sugar factories, the minister requested the Centre to suggest the Ministry of New and Renewable Energy to approve the state proposal to set up the Centre of Excellence on Green Energy in Belagavi. The centre proposed by S Nijaligappa Sugar Institute aimed at providing technical knowhow, including marketing issues related to bio-energy, and it will be established by the state government with the help of the Centre, Munenakoppa said.

The above news was originally posted on www.deccanherald.com

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