The Centre is expected to soon announce a Rs 8,000-crore package to help sugarcane farmers who have long waited for their dues from sugar mills, several reports said on Monday. This follows the ruling Bharatiya Janata Party’s loss last week in a bye-election in Kairana, which falls in the sugar belt of Uttar Pradesh. Sugarcane farmers in the region are among the worst hit by pending dues.
The relief package the government has come up with includes creating a buffer stock of 30 lakh metric tonnes, unidentified officials told The Indian Express. The government will bear the mills’ cost on interest, storage and insurance, estimated to be about Rs 1,200 crore. This is likely to help mills improve their liquidity so that they can pay farmers.
The money for the buffer stocks will be directly transferred to the farmers’ accounts, according to the Hindustan Times.
Another feature of the package is likely to be a Rs 4,400-crore scheme to increase the production capacity of ethanol in India, the officials told the newspaper. Sugarcane can then be diverted for use in the production of ethanol in surplus years so that farmers are paid on time. The government is also likely to set a minimum price for the sale of sugar at Rs 29 per kg.
The Cabinet is likely to decide on the package in the next two days, unidentified officials told The Times of India.
Sugar mills in the country owe over Rs 23,000 crore to sugarcane farmers, with Uttar Pradesh accounting for Rs 12,500 crore of the amount. The figure in Kairana alone is more than Rs 800 crore, according to The Indian Express. In nearby Baraut city, a farmer who was protesting the non-payment of dues by sugar mills died a day before the bye-election. Dozens of sugarcane farmers had started a protest on May 21.