It could well be a pointer to the future.Private mills are making slow inroads into Maharashtra's sugar industry, currently a bastion of cooperative barons.

At the start of this century, there were barely a handful of private players — including the Doshi family's Ravalgaon Sugar Farm Ltd and the not-so-known Saswad Mali Sugar Factory — accounting for two-three per cent of the State's production.

But, today, there are some 25 privately owned mills, with their share in Maharashtra's sugar output steadily rising to 12-13 per cent (see Table).

During the 2007-08 season (October-September), they together produced nearly 1.2 million tonnes (mt) against just 0.2 mt in 2000-01. Last season, this halved to 0.6 mt, which was, however, in line with the overall industry trend.

The private sector's re-emergence is, in some ways, a case of the wheel turning full circle, though it is still some distance from that. Till the early 1950s, Maharashtra's sugar industry was controlled by the Somaiyas, Doshis, Radhakrishna Ruias and the Dhoots (of ‘Videocon').

But with the entry of cooperatives, many of them had to shut down or relocate to other States. This was largely courtesy the State Government policies that, before the industry's de-licensing in 1998, clearly favoured the co-ops.

Different breed
The present lot of private promoters is, however, different from the earlier set. Either they have cut their teeth in cooperatives, or are politicians or their kin.

Take Mr B.B. Thombare of Natural Sugar & Allied Industries, whose factory at Kallam (Osmanabad district) has a crushing capacity of 7,500 tonnes cane a day (tcd). Before starting it in 2000-01, Mr Thombare was the Managing Director of two cooperatives — the Manjara (Latur) mill of the ex-Chief Minister, Mr Vilasrao Deshmukh, and the Vaidyanath (Beed) unit of the former Deputy Chief Minister, Mr Gopinath Munde.

A variant of the same phenomenon is the 2,500-tcd Vitthal Sugars Manufacturing Ltd at Madha, Solapur. Its chairman, Mr Sanjay Vitthalrao Shinde, is the son of the founder of the nearby 6,000-tcd Vitthalrao Shinde Cooperative Sugar Factory.

In the second category are Mr Rajendra Pawar's 4,500-tcd Baramati Agro and Mr Ajit Pawar's 3,500-tcd Daund Sugars Ltd, both in Pune district. Their promoters are nephews of the Union Agriculture Minister, Mr Sharad Pawar.

Likewise, the Saikrupa Sakhar Karkhana in Shrigonda (Ahmednagar) belongs to the State's Tribal Development Minister, Mr Babanrao Pachpute.

But it is not only the Congress and NCP leaders who are busy setting up private sugar mills in the State. The promoter of Purti Sakhar Karkhana Ltd at Umred (Nagpur) is none other than the recently elected National President of the Bharatiya Janata Party (BJP), Mr Nitin Gadkari.

The 2,500-tcd Lokmangal Agro Industries Ltd at Solapur belongs to the former BJP Member of Parliament, Mr Subhash Deshmukh, while Mr Kisanrao Bhandare of Pannageshwar Sugar Mills (Latur) is ‘close' to Mr Munde.

Not all of the new private mills are said to be doing well — more so with the drying up of cane supplies that has impacted capacity utilisation.

“The best among them are Natural Sugars and Shri Gurudatta Sugar Ltd (a 2,500-tcd plant at Jaysingpur in Kolhapur), besides the old Saswad Mali factory. They have consistently been crushing five lakh tonnes-plus cane in the last few season”, industry sources said.

source: thehindubusinessline


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