While Uttar Pradesh’s sugar millers are firm on suspending operations, farmers want the Centre to take over the mills to rescue them.
The millers have refused to start operations despite a directive from UP Chief Minister Akhilesh Yadav.
Farmers have urged the Centre to take control of the mills by invoking the Sugarcane Undertaking (Taking Over of Management) Act, 1978, which provides for temporary taking over in public interest.
UP is the second largest producer of sugar, but has the highest cane acreage in the country. The commencement of cane crushing has been delayed over the issue of pricing.
Urging Prime Minister Manmohan Singh to resolve the current crisis, V. M. Singh, Convener of the Rashtriya Kisan Mazdoor Sanghatan (RKMS), said: “The situation in UP now is identical to that of 1978 when cane dues of Rs 53 crore were unpaid and mills had refused to start crushing the next season. The Centre had promulgated an ordinance on November 9, 1978, and then enacted a law to save the farmers.”
In a letter to the Prime Minister, the RKMS said that the mills cannot be allowed to take the farmers for a ride by refusing to crush the cane.
“If 54 lakh farmers are to be saved, there are only two options. The mills have to be acquired by the State by invoking the provisions of the UP Sugar Undertaking (Acquisition) Act, 1971. Else, the management of the mills have to be taken over for 2-3 years invoking the Sugar Undertaking Act,” Singh said.
“The mills have made huge profits in last few years and multiplied their units from 40 to 100. Then, why are the farmers expected to share their losses when profits were never shared,” Singh asked.
Mills’ stand
Meanwhile, the UP Sugar Mills Association, while reiterating that mills do not have the resources to start crushing, demanded that the UP Government come out with a financial package whereby the difference between the paying capacity of mills and the State-Advised Price (SAP) can be met through financial assistance. The mills have said they can pay only Rs 225 per quintal at current sugar prices.
UP has kept the SAP for sugarcane unchanged at Rs 280 per 100 kg for the 2013-14 season. Millers have termed the SAP as unviable as sugar production cost at this cane price was Rs 35 a kg, while the prevailing ex-factory market price of the sweetener is Rs 29 a kg, resulting in a loss of Rs 6/kg of sugar produced.
While the millers are yet to pay farmers last season’s dues of Rs 2,400 crore, bankers have refused to extend working capital loans to the beleaguered sector.