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Wednesday, December 08, 2021

Karnataka halts move to privatise century-old Mysore Sugar company

CM Basavaraj Bommai said the Cabinet’s earlier decision to privatise the loss-making company will be reviewed on the basis of an expert committee’s recommendations.

Written by Darshan Devaiah BP | Bengaluru |
Updated: October 18, 2021 7:44:24 pm
BommaiChief Minister Basavaraj Bommai (File photo)

The Karnataka government Monday announced that it will put on hold the move to privatise the century-old Mysore Sugar Company Ltd in the wake of a month-long protest organised by farmers in Mandya region.

Chief Minister Basavaraj Bommai chaired high-level meetings with farmers’ representatives and elected representatives from Mandya district and said the Cabinet’s earlier decision to privatise the loss-making company will be reviewed on the basis of an expert committee’s recommendations within three months.

“An expert committee will be set up to study the condition of the factory and finances needed to restart along with the working capital required to make payments to farmers,” Bommai said after the meeting.

The Janata Dal (Secular) and the Congress had criticised the move to privatise the lone state-owned sugar factory even as farmers staged protests in Mandya for weeks.

The chief minister further said that till the committee’s reports are submitted to the government, an officer will be posted as the Managing Director of the factory. Besides, industry experts will be appointed and the Auditor General’s help will be sought to audit the company’s accounts.

Bommai said the committee will submit its report in three months, after which it will be placed before the cabinet for review.

The chief minister, who was recently in  Mysuru to participate in the Dasara procession, had met the protesting farmers in Mandya on his way and had assured them that their problems would be solved.

Earlier, the state Cabinet had decided to hand over the factory on lease. A controversy erupted after the government decided to privatise it and flared up after Industries Minister Murugesh Nirani, who owns sugar factories, stated that privatisation was the best way to solve the crises faced by the sugar company. Later in the Legislative Council, he assured that his group would not participate in the tender process for the privatisation of Mysore Sugars Company.

The state government had decided to lease the factory for a period of 40 years similar to the Pandavapura Sahakari Sakkare Karkhane (PSSK), which has been taken on lease by a company founded by Nirani.

Congress leader Siddaramaiah, who is also the Leader of Opposition, too had opposed the government’s move and extended support to the protesting farmers.

Founded by the erstwhile Maharaja of Mysuru, Nalwadi Krishnaraja Wodeyar in 1933, the Mysore Sugars Company was the backbone of sugarcane farmers in Mysuru and Mandya region. It has the capacity to crush 5,000 metric tonnes of sugarcane annually.

The firm was once one of the biggest sugar factories in Asia and raked in profits for several years before it subsequently suffered losses. The company was declared sick by the Board of Industrial and Financial Reconstruction (BIFR) in 2005.

 

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