Maharashtra to approach Centre to tide over sugar crisis

The state government is planning to approach the Centre to ask for decontrolling of the sugar industry which will ensure greater competition and enable the survival of more than 200 sugar factories across Mahatrashtra.

The state government, which has promised to pay higher remuneration to sugarcane farmers to end the agitation launched by Swabhiman Shetkari Sanghatana (SSS), is worried as factories have expressed their displeasure to match the high price. The state may seek a bailout package from the Centre.

The high costs incurred in sugarcane cultivation are the result of steep hike in the prices of fertilisers, which is controlled by the Centre. But, the farmers are seeking to recover their costs by demanding higher rates for their sugarcane. The state, buckling under the SSS’ pressure, has hiked the rates from Rs1,450 per quintal to Rs1,800 and Rs2,050 per quintal.

Minister for co-operation Harshvardhan Patil admits that the economics of the industry is going awry. “The state finds itself in a Catch-22 situation. On the one hand, it has to work under the regulations laid down by the Centre and on the other, it had to agree to the farmers’ demand for higher compensation.”

The sugar industry in the state accounts for a whopping Rs25,000 crore of business. The 124 sugar cooperatives factories and 49 private factories account for 3.5 lakh labourers, and there are almost 2.10 lakh employees working in the factories.