CM asks Centre to expedite debt restructuring package for TN sugar mills

Chennai: Tamil Nadu Chief Minister K Palaniswami has urged the Centre to instruct banks to finalise the debt restructuring package soon for the sugar mills and batted for other measures, including disbursal of loans to cane farmers to revive the sugar industry in the state.

Listing out steps needed for the beleaguered sugar sector, he flagged the restructuring of loans availed from banks and financial institutions by the sugar industry and the Sugar Development Fund loans secured by private and cooperative mills.

"The banks and financial institutions may be instructed to finalise the debt restructuring package soon," he said in a letter to Union Finance Minister Nirmala Sitharaman.

The Chief Minister requested her to advise banks and institutions not to take harsh measures under the Insolvency and Bankruptcy Code, The Securitisation Act (SARFAESI Act), or refer cases to the Debt Recovery Tribunal until steps were finalised to revive the sugar sector.

Also, he wanted the Centre's sanction for additional sugar release to mills in Tamil Nadu to improve their financial liquidity.

"Banks may be advised to release loans to farmers for cultivating sugarcane, even if the earlier loans have not been repaid by them.

This non-repayment of loans is due to the non-payment of FRP (Fair and Remunerative Price) dues by the sugar mills," he said in the letter dated 24 October and released to the press on Saturday.

To protect the livelihood of nearly four lakh farmers of Tamil Nadu, "I request your continued support and favourable orders from the government of India for reviving the Tamil Nadu sugar industry," Palaniswami said.