SOCIO ECONOMIC IMPACT OF A PRIVATE SUGAR FACTORY A CASE STUDY OF NATURAL SUGAR AND ALLIED INDUSTRIES LIMITED SAI NAGAR RANJANI TAL.KALLAMB DIST.OSMANABAD. Thesis submitted to Faculty of Moral and Social Sciences Tilak Maharashtra Vidyapeeth Gultekadi, Pune-37 For the degree of Doctor of Philosophy in Economics By Vidyadhar P. Yadav (M.Com.,L.L.B.,M.P.M.) Research Guide Dr. S. K. Dhage (M.A., L.L.B., M.Ed., M. Phil., Ph.D.) Associate Professor and Head, Department of Economics, Baburaoji Gholap College, Sangvi, Pune- 411 027. Research Centre Department of Economics Tilak Maharashtra Vidyapeeth Gultekadi, Pune- 411037. Aug, 2013 i DECLARATION I hereby declare that the work incorporated in this thesis entitled, ‘Socio Economic Impact of a Private Sugar Factory:A Case Study of Natural Sugar and Allied Industries Limited’ completed and written by me has not been submitted in part or full for any degree or diploma of any other university or examining body. Place: Pune Vidyadhar P. Yadav Date: Aug, 2013 Research Student ii CERTIFICATE This is to certify that the work incorporated in the thesis entitled ‘Socio Economic Impact of a Private Sugar Factory: A Case Study of Natural Sugar and Allied Industries Limited’ submitted by Vidyadhar P. Yadav was carried out by the candidate under my supervision for the degree of Doctor of Philosophy. Such material obtained from other sources has been duly acknowledged in the thesis. Dr. S.K. Dhage Place: Pune Research Guide Date: Aug, 2013 Head, Department of Economics, Baburaoji Gholap College, Sangvi, Pune- 411027. iii ACKNOWLEDGEMENTS I express my whole hearted deep sense of gratitude and indebtedness to my research guide Dr. S.K. Dhage, Head, Department of Economics, Baburaoji Gholap College, Sangavi, Pune, for his keen interest, constant inspiration, valuable and scholarly guidance, constructive criticism, constant encouragement and sympathetic attitude. I am highly grateful to Dr. C.P. Hase, Prof. Manoj Pandkar, Prof.S.M. Kakade, and Dr. B.G. Lobo for their moral support. I have no words to express my feelings towards Shri. B. B. Thombre (Chairman and Managing Director of Nsai. Ranjani, Smt. P.B. Thombare Director Nsai, Shri V.G. Gangane General Manager Administration, Shri.Divekar U.D. Gen. Manager Technical, Shri. S.U. Vedpathak, Finance Manager, Shri. D.L.Kadam, P.A. to CMD, Shri. Kuldeep Yadav, Engineer. Mech Div., Shri. N.D. Pawar, Producer Member Devola, for their kind help during the course of investigation. I also extend my thanks to the staff of the Natural Sugar and Allied Industries, Ranjani for their kind help and co-operation during the course of investigation. I express my heartfelt thanks to Mr. Kudale, and Smt. Anjali Munde for their kind co-operation and technical help. It is my great pleasure to thank Prof. Santosh Sasturkar, Prof. S.U.Gawade Mrs. Gargote, Shri R.V.Apte, Shri. S.M. Ahire for their friendly support. I would also like to thank the authorities of Mahatma Phule Krishi Vidyapeeth, Rahuri, Vasnatdada Sugar Institute, Pune, Gokhale Institute of Politics and Economics, Pune, Tilak Maharashtra Vidyapeeth Pune. Words are simply inadequate to mention the love, affection and care taken by father Mr. P.K.Yadav Freedom Fighter, mother Late. Gangabai Yadav, brothers Vishwas, Madan, Raosaheb. Last but not the least my heartfelt gratitude to my beloved wife Kusum, son Soham, and daughter Amruta without whose support this would not have been possible. Place: Pune Vidyadhar P. Yadav Date: Aug, 2013 Researcher iv CONTENTS Chapter No. Particulars Page No. List of Tables List of Figures Chapter I INTRODUCTION 1-20 1.1 Sugar Industry 1 1.2 History of Sugarcane and Sugar Production 1 1.3 The Co-operative Movement 3 1.4 Present Status of Sugarcane Crop in India 7 1.5 Present Status of Sugarcane Crop in Maharashtra 7 1.6 Importance of the Sugar Industry 7 1.7 Present Status of Sugar Industries in India 8 1.8 Present Status of Sugar Industries in Maharashtra 10 1.9 Types of Sugar Industries in India 14 1.10 Size of the Industry 14 1.11 Total Contribution to the Economy/ Sales 14 1.12 Latest Developments in Sugar Industry 16 1.13 Indian Industries 17 1.14 Some of the towns of Maharashtra which have sugar factories 18 Chapter II RESEARCH METHODOLOGY 21-30 2.1 Introduction 21 2.2 Selection of the Subject 21 2.3 Objectives of the Study 23 2.4 Hypothesis 24 2.5 Scope of the Study 24 2.6 Sampling Design 24 2.7 Selection of Villages 25 2.8 Details of Selected Villages 25 2.9 Selection of Farmers 27 2.10 Limitations of the Study 27 2.11 Primary Data 28 v 2.12 Secondary Data 29 2.13 Selection of Sample 29 2.14 Method of Analysis 29 2.15 Chapter Scheme of the Study 30 Chapter III REVIEW OF LITERATURE 31-44 Chapter IV SOCIO ECONOMIC PROFILE OF COMMAND AREA 45-59 OF NSAI 4.1 Profile of the Osmanabad 45 4.2 Profile of the Latur District 49 4.3 Profile of the Beed district 52 Chapter V NATURAL SUGAR AND ALLIED INDUSTRIES 60-70 LIMITED (NSAI) 5.1 Introduction 60 5.2 Brief Profile of Company 60 5.3 Natural Sugar - A Success Story 60 5.4 Dividend 68 5.5 Cane Development 69 5.6 Contribution to the Non-Conventional Energy Concept 70 5.7 Extension of Ferro Alloy Project 70 5.8 Energy Conservation 70 Chapter VI RESULTS AND DISCUSSION 71-155 6.1 Overall Performance of NSAI 71 6.2 Impact of NSAI on Ariculture Economy 92 6.3 Impact of NSAI on Employment 121 6.4 Overall Change During Last Ten Years 135 Chapter VII SUMMARY, CONCLUSIONS AND SUGGESTIONS 156-183 7.1 Summary 156 7.2 Conclusions 157 7.3 Testing of Hypothesis 177 7.4 Suggestions 179 BIBLIOGRAPHY 184-188 QUESTIONNAIRE 180-202 ANNEXURES 203-206 vi List of Tables Table Particulars Page No. No. 1.1 Growth of India’s Sugar Industry. 10 1.2 District-wise Distribution of sugar factories in Maharashtra. 13 1.3 Growth of India's Sugar Industry. 15 1.4 Crushing of Sugarcane and Per cent Sugar Recovery in Maharashtra 20 during the period from 2001-02 to 2012-2013. 2.1 Tashil wise area under sugar cane in the command area of NSAI. 25 2.2 Selected sugar cane cultivating villages in the tahsils. 25 2.3 Selected villages under sugar cane cultivation in the command area of 26 NSAI. 2.4 Tashil wise selected sugar cane cultivating farmers. 27 6.1 Crushing of Sugarcane and Sugar Production. 72 6.2 Pol. per cent of cane and recovery of cane. 74 6.3 Production and sale of Molasses of NSAI. 76 6.4 Production, internal/own consumption of Bagasse and sale of Bagasse of 78 NSAI. 6.5 Production and Sale of Ferro Manganese of NSAI. 80 6.6 The production and sale of Silico Manganese of NSAI. 82 6.7 The production and sale of Electricity of NSAI. 84 6.8 Income of NSAI. 86 6.9 Expenditure of NSAI. 89 6.10 Profit and loss account of NSAI during the period from 1999-2000 to 91 2010-11. 6.11 Export of NSAI. 92 vii LIST OF FIGURES Figure Particulars Page No No. 1.1 Map showing network of Sugar Industry in India 9 1.2 Location of Sugar Factories in Maharashtra 12 6.1 Crushing Sugar and Sugar Production 73 6.2 Pol. per cent of cane and recovery of cane 75 6.3 Production and sale of Molasses of NSAI 77 6.4 Production, internal/own consumption of Bagasse and sale of Bagasse of 79 NSAI 6.5 Production and Sale of Ferro Manganese of NSAI 81 6.6 The production and sale of Silico Manganese of NSAI 83 6.7 The production and sale of Electricity of NSAI 85 6.8 Income of NSAI 87 6.9 Expenditure of NSAI 90 viii Introduction Chapter I INTRODUCTION 1.1 Sugar Industry The sugar industry has played an important role in social and economic development of rural areas in India and especially in Maharashtra. It is the second largest agro-based industry in the country, next to Textile industry. The sugar factories have been established in sugarcane-growing areas and have become centres of development for their areas of operation. The sugar factories have helped decentralization of industries in rural areas. They have also deeply influenced development of agriculture in rural economy. Because of these sugar factories, even small farmers have indirectly become industrialists by virtue of their membership of sugar factories, which produce a number of by-products. The sugar factories have been instrumental in establishing English medium public schools, high schools, colleges etc. They have caused establishment of hospitals, milk dairies, poultry farms, consumer stores, banks, libraries, entertainment centers, workshop, oil mills and super market in rural areas. Similarly, for production of more sugarcane, these factories implemented various lift irrigation schemes, small medium and large water tanks and have provided irrigation facilities to large tracts of lands. Likewise, they have helped in construction of roads in their areas of operation. Due to the establishment of these factories, the businessmen and traders could expand their business. The problem of rural unemployment has also been greatly solved because of these sugar factories. In this way, the sugar factories have been helping large-scale development of the rural areas. All the above contributions of the co-operative sugar factories have underlined their role in the rural economy. 1.2 History of Sugarcane and Sugar Production “According to Hindu mythology, the sugarcane crop is related to the God Ganesh and Goddess Laxmi and is a symbol of affluence.