Cabinet approves additional funds for interest subvention on loans to sugar mills; Sugar stocks trade mixed

Shares of Balrampur Chini Mills, Dhampur Sugar Mills, and Bannari Amman dropped 3%, 4%, and 2%, respectively. However, Bajaj Hindusthan Sugar, and Shree Renuka Sugars rose 1% each.

Mar 07, 2019 08:03 IST India Infoline News Service

The Cabinet Committee on Economic Affairs (CCEA) on Thursday granted approval for funds of Rs2,790cr towards interest subvention for extending indicative loan amount of Rs12,900cr by banks to the sugar mills.

Post the announcement, sugar stocks were trading on a mixed note. Shares of Balrampur Chini Mills, Dhampur Sugar Mills, and Bannari Amman dropped 3%, 4%, and 2%, respectively. However, Bajaj Hindusthan Sugar and Shree Renuka Sugars rose 1% each.

The government granted funds under “Scheme for extending financial assistance to sugar mills for enhancement and augmentation of ethanol production capacity” for the 268 applications/proposals, in addition to Rs1,332cr already approved by CCEA in June 2018.

CCEA has also approved Rs565cr towards interest subvention for extending indicative loan amount of Rs2,600cr by banks to the molasses-based standalone distilleries to augment capacity through the installation of incineration boilers and other methods in the existing distilleries for achieving ZLD and additional equipment for ethanol production as well as for setting up of new standalone distilleries for ethanol production.

A separate scheme for the molasses based standalone distilleries would be formulated accordingly by Department of Food & Public Distribution.

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