Centre nod for soft loans to clear cane arrears

Reaching out to influential cane farmers ahead of Lok Sabha elections, the Modi government on Thursday night announced soft loans to sugar mills to help them clear the arrears due to farmers that have accumulated to the tune of Rs 20,159 crore.

The Cabinet Committee on Economic Affairs, at a meeting chaired by Prime Minister Narendra Modi, approved the proposal to provide soft loans to the extent of about Rs 7900-10,540 crore to the sugar industry.

The government will bear the interest subvention cost at the rate of 7- 0% to the extent of Rs 553 crore to Rs 1,054 crore for one year, Finance Minister Arun Jaitley told reporters here.

In a bid to ensure that the money reaches farmers at the earliest, the banks will get details of farmers to whom arrears are to be paid so that the same are directly credited to their bank accounts.

The approved soft loans will be provided to those sugar mills that have already cleared at least 25% of their outstanding dues in the sugar season 2018-19, Jaitley said.

Uttar Pradesh, Maharashtra and Karnataka -- which together send 155 members to the 545-member Lok Sabha.