Producers of khandsari, a type of unrefined, raw white sugar, are trying hard to protect their interests amidst a call for the export restrictions on the commodity by the Indian Sugar and Bio-Energy Manufacturers Association (ISMA).
The Bhartiya Heritage Association of Khandsari and Traditional Sweeteners Industry (Bhakti) has announced plans to advocate for the interests of the khandsari sugar industry. Bhakti leaders intend to meet with officials from the Directorate General of Foreign Trade (DGFT) and Uttar Pradesh Chief Minister Yogi Adityanath to demand protection for the industry, which they argue is essential for the survival of small sugarcane farmers.
ISMA recently urged the DGFT to impose export restrictions on Khandsari sugar, citing competition and concerns over cane supplies. In response, Shashikant Pandhre, Director General of Bhakti, told businessline that Khandsari units play a critical role in the livelihoods of small sugarcane farmers in Uttar Pradesh and Maharashtra, many of whom rely on the industry for immediate cash needs that larger mills cannot fulfil.
“Khandsari is a small industry which serves farmers and must be protected,” Pandhre stated, adding that these traditional units often pay farmers more than the government-mandated Fair and Remunerative Price (FRP).
Pandhre criticised ISMA’s push for restrictions, calling it “unfair” and asserting that Bhakti would explain their stance in the upcoming meetings with DGFT officials. Additionally, the association plans to appeal to Uttar Pradesh Chief Minister Yogi Adityanath, as hosts the highest number of khandsari units in the country.
Bhakti pointed out that while ISMA exported 5 lakh tonnes of sugar in the 2023–24 crop year, it is now opposing Khandsari exports of less than half that amount. The association called ISMA’s stance contradictory, noting that ISMA is also lobbying for permission to export an additional 20 lakh tonnes of sugar while campaigning against the much smaller traditional sweetener sector.
Bhakti argues that Khandsari uses under 1 per cent of sugarcane output versus 75 per cent used by sugar mills.
ISMA’s stand
ISMA argues that the exemption of Khandsari sugar from current export restrictions, which apply to other sugar forms, has caused disruptions for the sugar milling industry and poses a threat to its revenue.
In a letter to the DGFT, ISMA highlighted the rapid growth of high-capacity Khandsari units in States like Uttar Pradesh and Maharashtra, where these traditional sugar producers demand substantial quantities of sugarcane. Uttar Pradesh alone has around 270–280 Khandsari units, requiring 100–110 lakh tonnes of cane annually, while Maharashtra’s smaller network of 10-15 units uses about 20–25 lakh tonnes. According to ISMA, this diversion of sugarcane has placed strain on established mills, undermining their operations and profitability.
ISMA expressed concern that during the last sugar season (October 2023 to August 2024), Khandsari units exported approximately 2.4 lakh tonnes of sugar while other sugar types remained restricted. The association claims that Khandsari producers often pay below the government’s FRP to farmers, creating an uneven playing field.