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Fiji to revive ailing sugar industry with India's help

Island nation Fiji's sugar industry, the backbone of the country's economy, is now in deep crisis. It is looking towards the robust Indian model, which can offer tailor-made schemes for a revival of the country's century old industry.

With this in view, Fiji Prime Minister Laisenia Qarase, who is also entrusted with the direct responsibility for the reform of the Fiji sugar industry, visited the Bannari Amman Sugar factory, near Nanjangud, about 20 kms from Mysore.

He spent almost half day in the morning today at the factory. He visited the sugar manufacturing unit, electrical unit, distillery, bio-composite yard and planted a sampling in the premises.

Later he told the media that his visit was aimed at learning technology from Indian sugar industries for the revival of his country's sugar industry, running at loss. "Power generation and co-generation is a model of this factory. That is what we thought of knowing and benefit from it for making sugar production at economical cost in our country," he said.

The visiting PM said, as the sugar industry in his country was on the verge of collapse, the Fiji government and the Asian Development Bank had developed a reform plan to bailout the ailing industry in his island nation. "To this effect, the Fiji government has requested the Sugar Technology Mission (STM) from India to make recommendations for its revival."

Apart from a number of problems that beset the Fiji sugar industry such as the impending expiry of preferential European Union sugar prices, the non-renewal of land leases and the milling and transportation inefficiencies, the cost of sugar production had gone high.

This is not felt now since Fiji enjoys a preferential quota price from the EU and the US, which is thrice more than the world market price. But, with the dismantling and curtailing of subsidies to the sugar beet growers in Europe as per the WTO directives, Fiji is expected to loose up to 35 to 40 per cent of its preferential quota in the first phase by 2008.

Unless the sugar industry improves its efficiency so as to compete globally, he said it will have to close down permanently. At present, Fiji's sugar production is between three lakh and 3.5 lakh tonnes, of which domestic consumption is 20,000 to 25,000 tonnes only. It has a preferential quota of 1.85 lakh tonnes for export to EU and 9,000 metric tonnes to USA. The preferential sugar is purchased by these two countries at more than three times the world market price.

"Hence, it is essential for us to set up co-generation power plants and also produce ethanol to bring down the cost of production, especially during the days of cruising crude oil prices. It is because of this, we visited this factory which has an integrated manufacturing facility, including co-generation of power and ethanol manufacturing, based on which we could model our plants in Fiji," said the visiting PM.

In order to help Fiji overcome the crisis, an Indian expert team visited Fiji in 2004 and after a survey has prepared a roadmap for its revival, on the basis of which a detailed action document has been drawn up. The Exim Bank of India has sanctioned a line of credit to meet the revival costs which is estimated at about 42 million US dollars.

Bannari Amman sugar factory CMD Dr.S.V.Balasubramanyam explained to Laisenia Quarase how the factory had grown into a sugar production complex with self-power generation and production of ethanol, besides sugar. "We are ready to share our experience," he assured the visiting PM.

"It will be our privilege to be a resource organization in the revival of Fijian sugar industry. We hope to share our experience in cane cultivation, sugar production, power co-generation and ethanol production, and provide necessary technical support to the ailing Fijian sugar industry, through SMT. If required, we are ready to send our expert team to assess the problems and issues and train the Fiji Sugar Corporation's personnel in different areas of sugar production," he said.

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