Sugar mills await SC sweetener

Written by ASHOK B SHARMA | New Delhi , Dec 13 | Updated: Dec 14 2007, 05:00am hrs
The Supreme Court is slated to hear on Friday a special leave petition, appealing against the order of the Lucknow bench of Allahabad High Court reducing the state advised price (SAP) for cane from Rs 1,250 to Rs 1,100 a tonne.

Sugar mills in Uttar Pradesh had filed a writ petition against SAP announced by the state government at Rs 1,250 a tonne and the HC bench passed an interim order on November 15 asking sugar mills to pay Rs 1100 a tonne for cane. Thereafter, farmers group Kisan Jagriti Manch (KJM) appealed to the Supreme Court on December 4 against the interim order.

Speaking to FE, the KJM general secretary Anil Singh said, UP cane growers have not paid the previous years arrears which have accumulated to over Rs 2,000 crore. The farmers do not want to sell canes at prices lower than Rs 1,250 a tonne as the input costs have gone up considerably. It is for this reason the fields have not been cleared of cane crops for sowing of wheat.

He further said wheat sowing would be delayed and it would cause a decline in production. Farmers will not clear their fields for wheat sowing until they get the right price for cane, he said.

Singh said the statutory minimum prices (SMPs) for canes announced by the central government each year were low and did not cover the costs of cultivation and therefore the state government had to announce SAPs to cover up the costs. The Commission for Agricultural Costs and Prices (CACP), while computing SMPs, does not take into consideration the revenue generated by the mills through the sales of by-products like molasses, ethanol, press mud, bagasse, power.

The National Commission on Farmers has recommended that farmers should get 50% more than the minimum support price for crops.

A constitution bench of the Supreme Court had earlier held that the state government has the power to fix SAPs for cane. Singh said that the Supreme Court in January 21, 1997 had granted leave against High Courts order quashing the SAP in another writ petition.