Sugarcane arrears of farmers down: Ram Vilas Paswan

Food Minister Ram Vilas Paswan on Friday said sugarcane arrears of farmers have come down significantly to Rs 1,314 crore from peak Rs 28,222 crore for the 2018-19 marketing year on the back of several measures taken by the Centre. Sugar marketing year runs from October to September. During Question Hour in Rajya Sabaha, Paswan said sugar production was high in 2017-18 and 2018-19 marketing years which led to a sharp decline in the domestic ex-mill prices of the sweetener.

"Low realisation from sale of sugar due to surplus sugar stocks had adversely affected the financial health of sugar mills, resulting in accumulation of cane arrears of farmers which peaked at Rs 23,232 crore during sugar season 2017-18 in May 2018 and at Rs 28,222 crore during the sugar season 2018-19 in April 2019," Paswan said.

To boost the liquidity position of mills and enable them clear cane price dues of farmers, he said the Centre took various remedial measures such as providing assistance to mills to offset the cost of cane, fixation of minimum selling price of sugar, financial assistance to maintain buffer stocks as well as exports, and soft loans. Paswan said the cane price arrears now are almost "negligible" for the last two sugar marketing years.

As a result of these measures, the all-India cane price arrears of farmers have come down to Rs 251 crore for 2017-18 based on state-advised price (SAP) and Rs 134 crore based on the central price called the Fair and Remunerative Price (FRP). For 2018-19, the arrears have come down to Rs 1,314 crore on SAP basis and Rs 931 crore on FRP basis, he said. Paswan said some states, including Uttar Pradesh, announced their own cane price called SAP, which is higher that the Centre's FRP.

The minister highlighted that the Centre has taken many steps in 2019-20 as well to help sugar mills clear cane dues. He said the Centre has created buffer stocks of 40 lakh tonnes of sugar, costing Rs 1,674 crore to the exchequer. That apart, an assistance of Rs 6,268 crore is being provided to help mills export 60 lakh tonnes of sugar. The Centre is also encouraging diversion of excess sugarcane and sugar to produce ethanol for blending with petrol.

Paswan said the sugar production is estimated at 273 lakh tonnes in 2019-20 as against domestic consumption of 260 lakh tonnes. In the previous year, sugar output was 331 lakh tonnes as compared with 259 lakh tonnes domestic demand.