The Centre on Wednesday approved a ₹25/quintal hike in fair and remunerative price (FRP) of sugarcane for the 2024-25 season (October-September). Last year, the FRP was raised by ₹10/quintal.

The FRP of sugarcane for season 2023-24 (October to September) will be ₹340/quintal for a basic recovery rate of 10.25 per cent. Earlier, it was ₹315/quintal. However, there will be a premium of ₹3.32/quintal for every 0.1 per cent increase in recovery over 10.25 per cent and a reduction of ₹3.32/quintal in FRP for every 0.1 per cent decrease in recovery.

FRP is the minimum price to be paid by sugar mills to farmers for buying sugarcane. However, as some states like Uttar Pradesh, Haryana and Punjab announce higher rates under State Advised Price (SAP), mills in those states abide by the state’s set rates.

Speaking to the media after the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, approved the FRP, Information and Broadcasting Minister Anurag Tahkur said that this is the historical price of sugarcane, which is about 8 per cent higher than the FRP of sugarcane for the current season 2023-24. The revised FRP will be applicable from October 1, 2024.

He said that India is already paying the highest price of sugarcane in the world, and despite that, the government has ensured the world’s cheapest sugar to domestic consumers.

The hike will benefit more than five crore sugarcane farmers (including family members). “It re-confirms fulfilment of Modi ki Guarantee to double farmers’ income,” he said.

As the Cabinet approval has come four months earlier (it was announced on June 27, 2023), experts link the move to convey the government’s resolve to take measures for farmers’ welfare amid the ongoing farmer’s protest, demanding a legal guarantee of MSP.

Thakur said that the new FRP is 107 per cent higher than the A2+FL cost of sugarcane production, and it will ensure the farmers’ prosperity.

With timely policy interventions by the government, sugar mills have become self-sustainable, and no financial assistance is being given to them by the government after 2021-22, an official statement said.