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Sugarcane growers' dues to banks cleared

Staff Reporter

Farmers from nearly 20 villagers in and around Ariyur can now avail of fresh bank loans

PONDICHERRY: Sugarcane growers from nearly 20 villagers in and around Ariyur can now avail themselves fresh bank loans as the Government has cleared their dues.

Around 1,500 sugarcane growers, mostly suppliers to the now defunct New Horizon Sugar Mill Limited, were not able to secure loans for the past three years, as mill owners did not repay the loan.

Agriculture Minister V. Vaithilingam on Monday informed reporters that the Government has remitted the total crop loan amount of Rs. 4.11 crore due to various banks.

"The amount was remitted in seven banks in Pondicherry and one bank in Tamil Nadu," he said.

Agreement

According to an agreement between sugarcane growers and the mill management, the owners would deduct the loan amount from the cane price and the money would be used for repaying the loan the growers had taken for cultivation.

The management collected an amount of Rs 5.14 crore but did not repay the loan, the Minister said.

High Court order

The Government intervened following a Madras High Court order. When the defunct mill was taken over by Indian Bank in January 2005, the management had to pay an amount of about Rs. 6.88 crore to sugarcane growers as cane price arrears and as crop loan to banks.

Stocks to be sold

When the sugarcane growers approached the High Court, it directed the Government to sell the stock of sugar and molasses to pay the amount due to the growers. Subsequently, an amount of Rs. 10 crore was raised through an auction of sugar and molasses.

Besides the Rs 4.11crore paid as bank loan, an amount of Rs 1.74 crore was disbursed among sugarcane growers towards the cane price due to them.

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