Centre mulls direct payment of sugarcane subsidy to farmers, sugar import duty hike

Union agriculture minister Radha Mohan Singh today proposed that the assistance to sugar mills for payment of support prices for sugar cane should instead be provided to farmers directly.

In a meeting with state governments to discuss the issue of pending sugarcane arrears, the minister also emphasised the need to encourage sugar exports and to increase sugar import duty by 40 per cent so that we can stop the imports.

Expressing concern over pending sugarcane arrears, minister for consumer affairs, food and public distribution Ram Vilas Paswan said all possible efforts must be made to facilitate payment of the arrears by the state governments.

Participating in the discussion state governments gave a number of suggestions which include:

• Creation of a sugar buffer stock by the centre;
• Facilitating loan from Sugar Development fund (SDF) for ethanol production, modernisation of mills and co-generation;
• Encouraging production of ethanol directly from molasses;
• Total ban on sugar import and hike in import from 25 per cent to 40 per cent;
• Export subsidy for export of white sugar;
• Direct transfer of subsidy or financial assistance from the centre to facilitate payment of the cane arrears; and
• Restructuring of interest-free loan being provided to the sugar sector.

Paswan said the government will take up the suggestion with the concerned ministries and take a final view in the interest of both the farmers and the industry.

Paswan also had day-long meeting with representatives of farmers on Wednesday to discuss the issue and to seek their suggestion. The meeting was attended by 24 organizations from all over the country.