The state government has initiated efforts to revive the Nizam Sugars Limited by constituting a Committee of Secretaries to suggest ways for the same. The state government issued orders to this effect on Wednesday.
As part of Public Enterprises Reforms Programme, the government equity in four units of Nizam Sugars Limited (Shakkarnagar Sugar unit in Bodhan, Metpally, Mombojipally sugar unit in Medak and Shakkarnagar distillery unit in Bodhan) was disinvested and a joint venture agreement was made between Nizam Sugars Limited and Delta Paper Mills Limited for management of the four units under a joint venture company called Nizam Deccan Sugars Limited. (NDSL).
The management of NDSL, however, has requested the government to permit it to sell the company’s land and scrap to clear dues of banks and farmers. Otherwise, NDSL may go to the purview of Board For Industrial and Financial Restruction (BIFR). As per the records available up to 2010-11, the NDSL has suffered `26.32 crore loss.
The state government felt that the NDSL was not in a position to clear farmers’ dues and pay salaries to its employees. Further, NDSL is largely dependent on financial support from the government to avoid reference of BIFR from time to time. “The purpose of disinvestment of the government was completely defeated. There was an unrest among farmers and employees,” the orders stated.
Keeping these factors in view, the government has decided to annul the JV agreement between Nizam Sugars Limited and Delta Paper Mills Limited.
It was decided to manage the affairs of NDSL in cooperative sector involving local farmers. For this, the government constituted Secretaries’ Committee with Chief Secretary as its chairman.
The committee will conduct an independent valuation from a reputed and independent valuer/auditor about the actual value of NDSL. The committee will furnish its report within three months to the government.
Source: The New Indian Express