Bajaj Hindusthan Ltd (BHL), the largest sugar producer in the country, has received approval of Uttar Pradesh Power Corp Ltd to shift one of its planned power projects from Bargarh in Chitrakoot district to Mirchwara in Lalitpur district within the state.
The 1980 mw unit of BHL-owned Bajaj Power Generation Private Ltd (BPGPL) was plagued by non-availability of adequate water.
Under the existing system, the company could have availed of water from the Yamuna only after receiving necessary approvals for construction of a barrage across the local river.
This prompted BPGPL to seek relocation of the unit which will now be clubbed with another 1980 mw project planned at Lalitpur.
In a related development, BHL has completed acquisition of 1,289 acres (out of the total requirement of 1,320 acres) for the latter project promoted by a special purpose vehicle, the Lalitpur Power Generation Company.
The twin projects would entail investments of `12,000 crore each. Till fuel linkage is obtained from the coal ministry, BHL plans to import the carbon resource from Indonesia for its entire needs.
But BHL’s core business of sugar (which is a form of carbon) is staring at a bleak future. Domestic production continues to outstrip consumption by a large margin and overproduction in Brazil and elsewhere is adding to the woes.
“The price outlook for 2012-13 continues to be bearish with independent estimates indicating 6.2 million tonne surplus for the period 2012-13. Brazil, the largest producer in the world, is expected to clock an output of 38.5 million tonne in 2013-14 as compared to 36.1 million tonne the previous year. High prices in 2011 led nations like China, Russia and Thailand to increase their output, further contributing to the ballooning surplus,” said BHL’s joint MD Kushagra Bajaj in the annual report.