Mumbai, Sep 2026 : Maharashtra Deputy Chief Minister Sunetra Ajit Pawar has directed officials to immediately submit a proposal to the state Cabinet for introducing a Soft Loan Scheme for cooperative sugar mills, modelled on the lines of the Central government’s initiative.
The proposed scheme aims to help cooperative sugar factories prepare for the upcoming crushing season and ensure that farmers receive their Fair and Remunerative Price (FRP) payments on time.
A meeting to discuss the proposed soft loan policy for cooperative sugar mills and a separate policy for by-products produced by sugar factories was held at Sahyadri State Guest House under the chairpersonship of Deputy Chief Minister Pawar.
Separate Policy for Sugar Industry By-products
Pawar emphasised the need for sugar mills to reduce their dependence on sugar production alone and expand into various by-products to strengthen their financial position.
Against this backdrop, she directed officials to formulate a comprehensive policy covering different by-products manufactured by cooperative sugar mills. The proposed policy is expected to accelerate investment and production in areas such as solar power, co-generation of electricity, first-generation (1G) ethanol, multi-feed ethanol, second-generation (2G) ethanol, compressed biogas (CBG), green hydrogen, bio-bitumen, biochemicals and sustainable aviation fuel (SAF).
The government believes diversification into these areas will help sugar mills create additional revenue streams while making better use of available resources and agricultural waste.
Relief for Farmers and Sugar Mills
The proposed Soft Loan Scheme is expected to ease the financial difficulties faced by cooperative sugar factories and help them meet their financial obligations towards farmers.
According to the government, improved access to soft loans would enable sugar mills to make FRP payments to farmers on time and complete preparations for the upcoming crushing season without financial disruptions.
The initiative is also aimed at strengthening the overall financial stability of the cooperative sugar sector and supporting the expansion of value-added activities associated with sugar production.
Pawar stressed the importance of creating a sustainable and diversified business model for sugar factories so that their economic viability does not remain dependent solely on sugar prices and production.
The proposed by-product policy is expected to provide a broader framework for encouraging modern technologies and new industrial applications within the cooperative sugar sector. It could also help mills move towards cleaner energy and alternative fuel production while generating additional economic opportunities.
The government will now prepare the proposal for consideration by the state Cabinet, following the Deputy Chief Minister’s directions.
Cooperation Minister Babasaheb Patil, Additional Chief Secretary of the Finance Department Vikas Chandra Rastogi, Principal Secretary of the Cooperation and Marketing Department Pravin Darade, Deputy Chief Minister’s Secretary Dr Rajesh Deshmukh, Finance Department Joint Secretary Madhav Veer and Planning Department Deputy Secretary Savita Jawale were among those present at the meeting.
The proposed measures are expected to provide support to both farmers and cooperative sugar mills ahead of the next crushing season, while laying the groundwork for greater diversification and value addition across Maharashtra’s sugar industry.
