New Delhi: Sharing concern of members in the Lok Sabha, government on Friday said steps will be taken to address problems afflicting the sugar industry, for which it has decided to provide soft loans of Rs 6,600 crore to enable payment of mounting dues to cane growers and have a 10 percent blend of ethanol in petrol.
Food and Civil Supplies Minister Ram Vilas Paswan said the money would go directly into the accounts of farmers so as to avoid any malpractice by the mills.
He said that he has called a meeting of representatives of all concerned-farmers, and cooperative and private sugar mills on August 14 to sort out the issues facing the industry.
This is because the situation in states like Uttar Pradesh has become "alarming". He said when he took over, outstanding dues were of the tune of Rs 13,000 crore. In UP, it came down to Rs 4,632 crore as on June 15 and as on July 7, the figure stood at Rs 5,741 crore.
"We have to have a holistic approach. We are concerned that situation may deteriorate if farmers come on the roads and sugar mills down their shutters," he said responding to a calling attention of Satyapal Singh and Krishna Raj (both BJP).
He said mill owners cannot do injustice to farmers and they should pay their dues and it is the duty of the state governments to ensure that the farmers are paid.
Paswan said that after a meeting with Petroleum Minister Dharmendra Pradhan it has been decided to mix 10 percent of ethanol in petrol, which would go a long way in helping the sugar industry and the cane growers.
He said that there was a proposal to increase import duty on sugar from 15 percent to 40 percent, but there are apprehensions that this will lead to increase in rate of sugar by Rs 4 to Rs 5 per kg.
He said that as on July 31 this year, the outstanding amount of sugarcane farmers in the country on sugar mills is Rs 9,252 crore and in Uttar Pradesh it is Rs 5,741 crore.
Paswan said mills are bound to pay farmers in 14 days and failing that the state governments are empowered to act.
In a statement, he said the cane price dues mainly pertain to supply of sugarcane in the current season.
The dues of previous seasons are generally on account of matters being sub-judice and mills taken under Securitisation Act by lender banks. The dues in the current season have arisen mainly on account of low realisation from sale of sugar.
He said the Centre has also notified another scheme in February this year allowing incentives for marketing and promotion services for raw sugar production targeted for the export market. The funds available under the scheme as also the soft loans shall be utilised by the sugar mills for making payment to the farmers.
He appealed the state governments to take action against the mills which default in making payments to the farmers.
Making an intervention, the Agriculture Minister said 22 crops are covered under the Minimum Support Price scheme and there are recommendations that sugarcane should also be brought under its ambit.
Satya Pal Singh (BJP) made a strong plea for a fair deal to the canegrowers saying that in his constituency of Baghpat alone plight of farmers is sad as they are yet to get Rs 650 crores of dues.
Government's plea that the matter is sub-judice and it cannot act will not work as farmers are angry and there could be a law and order situation, the former Police Commissioner of Mumbai said.
He suggested that a just five percent cess on sugar could bring Rs 5,000 crore for farmers each year. Alleging that the sugar mills are resorting to lot of malpractices, he said a sugar mill in his area has earned a profit of Rs 240 crores, but has diverted the money to other companies.
A case under section 420 should be filed against the company, he said.
