Mumbai: The Maharashtra Cabinet on Tuesday approved an estimated ₹ 738.51 crore interest subsidy for soft loans to cooperative sugar mills, aimed primarily at helping them clear pending Fair and Remunerative Price (FRP) dues to sugarcane farmers for the 2025-26 crushing season and meet preparatory expenses for the upcoming 2026-27 season.
Several mills faced financial difficulties, leading the government to extend financial support to help them meet their payment obligations to farmers and prepare for the coming season. The loan amount must primarily be used to pay pending FRP dues, while mills without outstanding dues can use the funds for pre-season preparations. As many as 102 cooperative sugar mills crushed 527.51 lakh metric tonnes of sugarcane during the 2025-26 season. Under the new scheme, loans sanctioned and disbursed by banks up to October 31, 2026, will qualify for the subsidy. The repayment period will be seven years starting October 1, 2026, and the interest subsidy will be available for the same period. The government will bear interest at 10% per annum or the actual bank interest rate, whichever is lower.
