The Hindu Business Line : Sugar sector woes: Kelkar panel to meet tomorrow

Hyderabad, Oct. 7 Officials, farmers and industry representatives from the Southern States would meet in Bangalore on October 9 to discuss and find solutions to the crisis in the sugar sector. The Bangalore meeting would also provide a platform for the stakeholders to discuss and suggest their opinions to the Vijay Kelkar Committee. The committee is looking into the issues being faced by the sugar sector.

SMP issue

One of the important issues that would come up for discussion is SMP (statutory minimum prices), the most contentious issue. While farmers have been demanding that SMP should be increased significantly, the industry felt that such a move would further burden them.

A senior Sugar Ministry official told Business Line that Andhra Pradesh had suggested to the Centre that while SMP should be announced before the season, SAP (State advisory price) could be announced after the harvest, based on the realisation. The factories could pass on part of the revenues they generated from non-sugar options, such as ethanol and co-generation. “This would bail out the sugar farmers,” the official said.

Assessing costs

Mr K. Prabhakar Reddy, who heads the sugar affairs at Federation of Farmers’ Associations (FFA), said the federation would demand a scientific method to assess cost of cultivation. “The present method being used by the CACP (Commission for Agricultural Costs and Prices) is completely irrational, outdated and unscientific,” he said. Mr Reddy, who would represent sugar farmers from Andhra Pradesh, said the Government interference should go in pricing issues. “The sugar control order says the interests of the consumers should be kept in mind while deciding the price of sugar. But only 20 per cent goes to the consumers directly, while the industry consumes the remaining quantity,” he pointed out.