Sugar is said to have originated in India. Indian sugar industry is the second largest agro-based processing industry after the cotton textiles industry in country, has a lion's share in accelerating industrialization process and bringing socio-economic changes in under developed rural areas. Sugar industry covers around 7.5% of total rural population and provides employment to 5 lakh rural people. About 4.5 crore farmers are engaged in sugarcane cultivation in India. Punjab state is the one of the largest sugarcane production state in India and it plays main role to development in Punjab. Sugar industry plays important role in the national as well as state economy. Sugar industry has brought socioeconomic changes in rural punjab by way of facilitating entrepreneurial activities such as dairies, poultries, fruits and vegetable processing, and providing educational, health and credit facilities. But Punjab Sugar Industry is currently going through difficult times just like the sugar industries of several other states in India. Financial and infrastructural problems are believed to be the main reasons behind the problems plaguing Punjab’s sugar industry. The cost of production of sugar is very high in Punjab, which is the main cause of the financial crunch. Because of this, the units engaged in sugar production are making huge losses.