1. Arun Jaitley to assess impact of sugar sector demands

Arun Jaitley to assess impact of sugar sector demands

As the crisis in the sugar sector continues, finance minister Arun Jaitley is learnt to have asked his ministry...

By: and | Published: April 24, 2015 12:08 AM

As the crisis in the sugar sector continues, finance minister Arun Jaitley is learnt to have asked his ministry officials to assess the financial implications of key demands made by various industry stakeholders. The demands likely to be discussed include the creation of a strategic reserve or buffer stock for the sweetener.

Sources said Jaitley had a series of meetings on Wednesday — with an informal panel of ministers led by food minister Ram Vilas Paswan, a delagation from Maharashtra and senior industry executives — to seek ways to get huge cane arrears cleared at the earliest and prevent the crisis from spiralling further. The finance ministry officials will be assisted by their food ministry counterparts for this purpose. Cane dues owed to farmers across the country hit a record Rs 19,244 crore as of March 31.

Many of the proposals discussed were based on the recommendations that the food ministry had zeroed in on following a two-day deliberation with farmers and states last week, said a source.

Last week, Paswan had said the food ministry had taken up seven proposals —including creating a buffer stock by the government and raising import duty on the sweetener to 40% from the current 25% — for further discussion. The proposals, aimed at improving sugar mills’ capacity to clear cane dues, also included incentives for white sugar exports, restructuring of interest-free loans, direct central assistance to farmers and extending credit from the Sugar Development fund for ethanol production, modernisation of mills and co-generation and permission to produce ethanol directly from molasses.

Separately, the Indian Sugar Mills Association (ISMA) has also been asking for a subsidy of Rs 7 per litre on ethanol so that mills can divert B-heavy molasses — currently used to produce only sugar — for the production of the bio-fuel. The demand is aimed at cutting a glut in refined sugar to halt a slide in sugar prices and ensuring adequate supplies of ethanol so that the blending of the bio-fuel with petrol at a 10:90 ratio, as proposed by the govenrment, becomes a success.

SUGAR DISORDER

Sources said Jaitley had a series of meetings on Wednesday — with an informal panel of ministers led by food minister Ram Vilas Paswan, a delagation from Maharashtra and senior industry executives — to seek ways to get huge cane arrears cleared at the earliest and prevent the crisis from spiralling further.

The finance ministry officials will be assisted by their food ministry counterparts for this purpose.

Many of the proposals discussed were based on the recommendations that the food ministry had zeroed in on following a two-day deliberation with farmers and states last week, said a source.

Only five Maha mills paid FRP to farmers this season

Nanda Kasabe

Only five of the 170-odd sugar mills in Maharashtra have been able to pay fair and remunerative price ( FRP) to farmers this season, top officials of the Cooperative Sugar Factories Federation in Maharashtra said.

Almost all mills have been waiting for the announcement of the Rs 2,000-crore interest free loan package that was expected in the State Assembly on Thursday. However, with no formal announcements coming from the government, millers now hope that a decision is taken next week. Around 38 factories in the state have been identified for revenue recovery hearings by the government.

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