Carrying out the threat issued to the state government a few days ago, sugar mills in Uttar Pradesh have decided en masse to shut shop, reports Deepa Jainani in Lucknow. With the government refusing to heed their demand for a sharp cut in cane prices for the current season, most of the100-odd mills in the state on Tuesday submitted letters stating the same to the cane commissioner. “We have been left with no option and are compelled not to commence the crushing operations and serve this notice of suspension of operations of our sugar mills for the current crushing season of 2013-14,” the millers said in separate but similar letters submitted on Tuesday. The move is not only likely to hit the R35,000-crore sugar industry in the state rather hard, but could also bring down the country’s sugar production drastically. Almost 30% of the country’s sugar is produced in the state. According to the industry, faulty government policies have cost them dear and the industry lost R3,000 crore in FY13 alone. The mills insist that they cannot pay the state-advised price (SAP) of more than R225 a quintal for the current season’s purchases. With domestic sugar prices likely to head north because of the Uttar Pradesh impasse, the
Centre will have a tough task at hand, especially with elections around the corner.
Copies of these letters have also been marked to chief secretary Jawed Usmani, principal secretary (cane) Rahul Bhatnagar, district magistrates of the districts where these mills are located, district cane officers and to the chairman/secretary of cooperative societies with a request that they provide appropriate and correct information to the farmers.
"Since India is the world's second largest sugar producer and UP is India's second largest sugar producing state, a dip in UP's sugar is likely to hit not only the country's sugar prices but is also expected to jack up sugar prices throughout the world if India is forced to import sugar for its own consumption,” said an industry source.
"And what is more, the government is taking further unwarranted action to further put the mills in deeper crisis,