Millennium Post

Rs 19,377-crore arrears are due to sugarcane farmers, points out Govt

Arrears of over Rs 19,000 crore are due to be paid to sugarcane growers in 18 states, of which almost Rs 10,000 crore is owed to farmers in Uttar Pradesh alone, Lok Sabha was informed on Tuesday. There was also no proposal currently before the Centre to pay these arrears directly to the farmers, Food Minister Ram Vilas Paswan said in reply to questions.

The total cane price arrears for the sugar season as on March 31 was Rs 19,377 crore, compared to Rs 18,648 crore for the corresponding period in sugar season 2013-14, he said. While arrears of sugar season as on that date for UP stood at Rs 9715.69 crore, Rs 2864.5 crore worth of sugar price arrears was due to farmers in Maharashtra and Rs 2402.39 crore due to farmers in Karnataka. Rs 842.46 crore was arrear amount in Tamil Nadu, while and Rs 682.28 crore was due to farmers of Punjab, he said. Paswan said the state governments have various mechanisms to ensure that the farmers are paid the arrears by the sugar mill owners, including police and legal action. 

On the basis of recommendations of Commission for Agricultural Costs and Prices and after consultations with state governments and other stakeholders, he said the Centre has revised the fair and remunerative price (FRP) of sugarcane for sugar season 2015-16 to Rs 230 per quintal, linked to a basic recovery of 9.5 per cent with a premium of Rs 2.42 per quintal for every 0.1 per cent increase above that level. The Minister said incentive scheme for promotion and marketing of raw sugar production targeted for exports has been extended for current sugar season 2014-15 for a quantity of 14 lakh MT at the rate of Rs 4,000 per MT.     

Centre likely to hike sugar import duty from 25 to 40%
The government is likely to raise import duty on sugar to 40 per cent from the current 25 per cent to check sliding price of the sweetener and enable mills to clear mounting cane arrears of about Rs 20,000 crore. A meeting of informal group of ministers, headed by Food Minister Ram Vilas Paswan, on Tuesday decided to recommend a hike in import duty of sugar.

A consensus also emerged on the issue of creating buffer stock, restructuring of loan, promotion of ethanol output, export subsidy on white sugar among others to help solve the current crisis faced by farmers and millers. “We discussed the suggestions made by farmers and state governments for early clearance of cane dues. Looking at the plight of farmers and unprecedented situation which sugar industry is facing, we have arrived at a consensus on couple of them to help in solving the problems in short term as well as long term,” Paswan said after the meeting. 

To implement some of the suggestions, the Cabinet proposals will be moved, while import duty can be hiked by the Finance Ministry through an executive order, sources said. In August last year, import duty on both raw and refined sugar was raised to 25 per cent from 15 per cent to bail out the cash-starved sugar industry. 

Besides Paswan, Transport Minister Nitin Gadkari, Agriculture Minister Radha Mohan Singh, Commerce Minister Nirmala Sitharaman, Petroleum Minister Dharmendra Pradhan, Women and Child Development Minister Maneka Gandhi and Minister of State for Agriculture Sanjeev Balyan were present in the meeting. On April 15-16, Paswan had called two separate meetings of farmers and chief ministers to resolve the cane arrear crisis.

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