INDIA: Farmers demand contract with company to run mill be cancelled

Published: 11/14/2017, 12:24:08 PM

Chandgad Taluka Janandolan Kruti Samiti - a farmers' organisation - held a rally outside Kolhapur District Central Co-operative (KDCC) bank's head office in Shahupuri area on Monday, according to the Times of India newspaper.

The farmers are demanding cancellation of the contract between the KDCC and a private company through which the former has leased the latter the functioning of Daulat Co-operative Sugar Factory in Halkarni.

Vijay Devane, leader of the delegation, said, "The sugar factory stopped crushing sugar cane for the last five years as it was unable to pay debts to various banks. In 2016, the KDCC bank took the initiative and leased the factory to a private company that started crushing in the year 2016-17. But the factory has not paid the dues to the farmers. The government has already asked the company to pay the due, but the company is yet to take a step in this regard. Hence, we request the KDCC to cancel the contract."

The delegation presented a memorandum of their demands to KDCC chairman Hasan Mushriff. "We had floated the tender 11 times to sell or lease the factory. But on as many as 10 occasions we did not receive any response. Only one company came forward and as per the procedure, we signed the contract and leased the factory to the company. We took a decision in the interest of the farmers and if the company is unable to pay the farmers their due, we will have to take legal action as per the contract. We will look into the provisions available in the contract and based on it we will initiate action against the company," Mushriff said.

The factory was unable to pay the loan of INR640 million (US$9.7 million) taken from KDCC and based on this the KDCC had leased the factory to the private company in 2016 that had showed willingness to run the factory.