Adiyanath to grant Rs. 5,535crore to sugar mills: Details here
Aiming to clear the cane arrears of farmers for the coming sugar season, Yogi Adityanath-led government has decided to grant Rs. 5,535cr package to the mills to clear their payments to the farmers. According to an Indian Express report, out of this Rs. 1,010cr will be distributed to 24 cooperative factories, and Rs. 25cr will be given to the sole state corporation-owned mill.
What about the remaining Rs. 4,500crore?
As per the same report, while Rs. 500crore will be given to private sugar mills, Rs. 4,000crore will be provided in the form of bad loans. "The entire money will be used for clearing cane arrears. We have already made monetary provision for the grants in August. The state cabinet will formally approve this package soon," said Suresh Rana, UP's Minister of Sugar industry.
And the rest Rs. 500crore?
"The remaining Rs. 500crore grant will be used to make payments to the private mills at the rate of Rs 4.50 per quintal," the minister said. "The interest rate that would be charged on the Rs. 4,000crore loan and the various conditions for availing that loan will be decided at the cabinet meeting which will take place next week," he added.
Is there more to the story?
While the minister made everything sound over simplified, there's more to the story that doesn't meet the eyes. Allegedly, the government's indifference to the cane workers contributed heavily to the BJP's loss in Kairana Lok Sabha bypoll in May. However, the minister disagrees. "Never in our history have mills crushed 111 crore quintals and made Rs. 25,550 crore, in a single season," he pointed.
The Government v/s the mills
Though the minister is confident that crushing for the coming season will definitely take off from around October 20, the millers have their own doubts. "With such low sugar prices and the banks hesitant to provide us advance working capital, how would we start the season?" a worried miller asked, adding that even if government pays them soft loan, how will they repay it?
No participation of the private mills
While the government is busy appeasing the cane growers, seems like they'll have to woo the private mills too. Neither did they participate in the cane area survey meetings conducted by the state government to assess the size of the crop, nor have they mentioned their cane demand for the new season. They have also boycotted the meetings where canes are assigned to mills.
Increased sugar prices?
Meanwhile, in between all these chaos, the Indian sugar industry has demanded a hike in the minimum sale price (MSP) of sugar by Rs. 8, i.e., from Rs. 29 a kilo to Rs. 36 a kilo since the coming October 2018-19 season.
