Sharad Pawar seeks centre’s urgent intervention to bail out sugar industry from crisis

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Former Union agriculture minister and Nationalist Congress Party leader Sharad Pawar on Thursday said that the Centre urgently needs to intervene to bail out the sugar industry from crisis aggravated exponentially by unprecedented nationwide lockdown in the wake of the coronavirus pandemic.

  • The immediate relief measures the federation has suggested to the centre are provision of funds for clearing export incentives and buffer stock expenses pending from 2018-19 and 2019-20.
  • Increase of Minimum Selling Price of sugar ranging from Rs.3450 to Rs.3750 with grade wise increment.
  • Provision of one time grant of Rs.650 per tonne on average cane crushed during the last two years.
  • Conversion of outstanding working capital into short term loan and rescheduling all term loans for 10 years with a moratorium of two years on the lines of Mitra Committee recommendations.
  • Treating sugar mills’ distilleries as Strategic Business Units (SBU’s) and on Stand Alone Basis the banks should finance the Ethanol Projects sanctioned under the Interest Subvention Capex Scheme announced by the Central Government in 2018.

Indian sugar industry has already been facing a crisis of lack of demand and piling cane dues, where now coronavirus has made the situation even more worrisome with the entire supply chain being stagnant. Logistics are also in a mess while buyers are reluctant to receive sugar despite having contracted. The pandemic has overall hit the sugar industry in terms of trends in feasibility of performance, production capacity, consumer market, sugar exports or precisely every factor that is incorporated to make this wheel from farmer to consumer run smoothly. Sugar millers have already started feeling the heat of financial stress with unsold sugar stocks, cane dues, unpaid interests etc.

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