MEERUT: Addressing the major crisis faced by sugar farmers, Union minister of state (MoS) for agriculture Sanjeev Balyan assured 'all possible help' from the Central government to sugar mills in exporting 15% of their sugar stocks.
Talking to TOI, The minister said it would be difficult for sugar prices to rise unless the sugar stock of 11 million tons is reduced. Balyan added that the government needed to buy more crops for the same.
"There is a sugar stock of around 11 million tons. The problem is that sugar production far outstrips the demand. This is the reason that has caused the recent crisis in the industry. Unless we reduce the sugar stock, we cannot expect sugar prices to rise again. That is why we are encouraging export. We aim to export at least 30 lakh tons of sugar. We have given each sugar mill a target and have said that they have to export at least 15% of their sugar stock. We will provide all possible help to them in securing this target. We have even reduced the export duty on sugar," Balyan said.
Balyan added saying, "The government announces MSP for a total 22 crops but so far, only two crops were purchased by the government. Wheat and rice are the only crops that were bought. From next year onwards, the government will purchase pulses as well."
The government's immediate priority, the minister said, was to ensure farmers were paid cane arrears at the earliest. "The Centre has not forgotten sugarcane farmers. The issue of non-payment of sugarcane arrears to farmers is a serious one. Earlier this year, we had launched a soft loan package for sugar mills so that they can pay farmers. Ensuring that farmers get their dues is a priority for us," he said.
Earlier this month, however, Union home minister Rajnath Singh had admitted that the Centre's loan package was not successful. "Sugarcane farmers' issue (cane arrears) is a serious issue. The government approved a Rs 6,000 crore soft loan to facilitate mills make payment to farmers, but it has not been quite successful. We are discussing this issue and will find solution," Singh had told the press.
Speaking to TOI, a sugar industry source explained how the benefits of sugar export would ultimately "trickle down" to farmers. "Right now the sugar industry is surviving on borrowed money, either from farmers or from banks. Right now, the stock is around 11 million tons. The consumption requirement of the entire country is around 24.5 million tons. Even before the new season has begun, we have enough sugar to cater to nearly half the population. Unless this stock is liquidated and converted into capital, the industry cannot survive. Once we have surplus cash, we can pay off our debts and be free of such obligations. That includes the money we have to pay to farmers. The perception that mills and farmers have contradicting interests is wrong. That will send a positive signal to the market and the prices are very likely to rise."
When asked what kind of support millers are expecting from the government, the source said, "The government has currently removed central excise duty on sugar. However, it is only for one year. They should ensure that they stand with the industry till it comes out of the crisis and not impose such tariffs. They should also keep our paying capacity in mind when deciding the fair and remunerative price (FRP) for sugarcane. A revenue-sharing agreement, whereby we pay farmers more as we earn more profits, is a viable solution for this."
Vinod Jatoli, district president of the Bhartiya Kisan Union (BKU), said, "Farmers have no problem if the central government provides mills with help as long as they are the eventual beneficiaries. The problem is that mills often don't share profits. The Centre gave an interest-free loan to sugar mills and they still haven't paid farmers fully. If exports bring them profits, we don't have a problem with it. We will, however, have an objection if they don't use those profits to pay farmers."
