UP sugar mills get ultimatum on crushing ops

Written by Deepa Jainani | Lucknow | Updated: Nov 12 2013, 09:51am hrs
Uttar Pradesh chief minister Akhilesh Yadav has issued an ultimatum to the sugar mill owners of Saharanpur, Meerut and Moradabad, asking them to begin crushing cane from November 20-25 and the rest by November 30. The CM said strict action would be taken if there is any further delay in the crushing operations.

Speaking to FE, the principal secretary of sugarcane, Rahul Bhatnagar, said the CM issued the order after chairing a review meeting on the sugarcane crushing season 2013-2014.

The CM asked the cane commissioner to inform all mill managers about these dates and immediately direct them to follow the instructions. Any further delay would warrant strict action, he said.

The strict action may include clamping Section 3/7 of the Essential Commodity Act and appointing government receivers, who would then run the sugar mills that have not complied with the orders.

We have been meeting the CM and his officials for the last five months and have been at pains explaining our financial situation and the fact that banks are not

giving us any more money to start this year's operations. Taking such a drastic step reeks of a knee-jerk reaction by the state government, said a miller.

Mills are willing to start crushing once the state government agrees to the linking of cane and sugar prices as per Dr Rangarajan Committee's recommendations. Unless that is done, banks are not going to give us credit. Instead of mulling coercive action, the government should look for solutions and help the industry come out of this situation this year, said Abinash Verma, DG, ISMA.

Our humble submission to the CM as well as the state government was that as per the sharing formula, the cane price payable to the farmers works out to R225 per quintal of cane. Should the government be inclined to pay a higher price to the cane farmers, the difference between the intended price and R225 may be paid directly to the farmers by the state government, said CP Patodia, chairman, UP Sugar Millers Association. "Unless the price linkage formula is put in place, the millers as well as the factories will die," he said.