"Freight difference between non-coastal and coastal states is Rs 500-600 per tonne while the government is giving only Rs 100 extra subsidy for mills in north India," officials in an industry body said, but declined to be identified.
The government should either have provided for the actual difference in freight cost or kept a single rate for all sugar factories in the country, they said.
"The mills in Uttar Pradesh have the option to export through Kandla and Mundra ports, which cost them Rs 900-1000 per tonne as freight while factories in coastal areas will have to bear Rs 300-400 a tonne," the industry officials said. So, the export incentives for non-coastal areas should have been in the range of Rs 1800-1900 per tonne, they added.
However, a section in the industry differed with this view, saying it would hardly make any difference as Uttar Pradesh, the leading sugar producer, does not export much.