Scale, Location and Diversification-Sugar Mill Industry in India

Sugar Mill Industry in India Sanjaya Baru While significant mill-level economies of scale do operate in the sugar industry, such economies are not always exploited due to specific historical, institutional and locational barriers which act as fetters on capacity expansion. Diversification is one response to a firm's inability to exploit scale economies. Another response is to turn the mill sick and either close it down or invite state take over.