Orissa set to announce new sugar policy

Dilip Bisoi
Posted: Monday, Nov 05, 2007 at 0000 hrs IST
Updated: Sunday, Nov 04, 2007 at 2351 hrs IST

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Bhubaneswar: The Orissa government is set to announce a policy to encourage sugar mills and cane farming in the state. “The state will soon announce a policy for sugar industries and cane growers”, said state agriculture director, Arabinda Padhi. “We are, in fact, working on formulating the policy “ he added.

Only last week, the Federation of Sugar Industries, in a memorandum to the state government, had demanded that the government come out with a policy to promote sugar mills and cane farming. According to the federation, there is a huge potential to not only make the state self-sufficient in sugar production but also exports. Pointing out that 12.5% value-added tax on cane, the highest in the country, was killing sugar mills in the state, the federation demanded that Vat rates be immediately rationalised. It said at least 15 crore farm labour days could be created in the cane sector in the state.

A staggering Rs 460 crore has been invested in six sugar mills in the state. However, the capacity of each of these mills has remained at 11,500 TCD (tonnes crushed per day). Given the potential of the state, there is scope for crushing 15 lakh tonnes of cane a year. But the total production of cane in the state is only six lakh tonnes. Also, the productivity of cane in the state is only 20-22 tonnes per acre against 40-45 tonnes in other states. The state’s total requirement of sugar is 5.40 lakh tonnes. Against this, the production stands at 45,000 tonnes. As a result, Orissa has to depend on other states to meet its sugar demand. Sugar cane produced in non-command areas, like Koraput, Nawarangpur and Kalahandi is being used only for making gur.

At one point of time, the Aska Sugar Mill was used to meet the state’s demand. But the plant turned sick as no fresh investment or plant modernisation took place. Similarly, the Nayagarh Sugar Mills and the Baramba Sugar Mills faced closure after Dharni Sugars and Shakti Sugars abandoned management of the mills. The state government has handed over Baramba Sugar Mills to the Balaji Group for revival. The mill is expected to commence crushing from this season.

Similarly, Nayagarh Sugar Mills, handed over to a private company, is to begin crushing from this season. Interestingly, Bijyananda Sugar Mills in Balangir, whose management was shifted to the co-operative sector from the private sector, is running to capacity. “The government’s new policy of sugar industries will certainly boost investment in the sector and farmers will benefit”, says Jagenswar, chairman of the Bijayananda Co-operative Sugar Mills.

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