Agri Business

UP sugar mills owe around ₹12,400 crore in cane payment

T V Jayan New Delhi | Updated on February 05, 2021

Mills have crushed nearly 560 lakh tonnes of sugarcane worth ₹17,635 crore on an average

The sugarcane crushing season may be well past the half-way mark, but the Yogi Adityanath government in Uttar Pradesh is yet to announce the State-advised price (SAP) for the season.

Last time, the SAP was revised in 2017 when the BJP government came to power in the State. The government, however, had directed the mills to make payment at the previous year’s rate of ₹315 per quintal.

According to data with the UP Sugar Industry & Cane Development Department, the sugar mills have crushed nearly 560 lakh tonnes of sugarcane, which could be, on an average, worth ₹17,635 crore. As of now, the payment made so far was ₹7,205 crore, as per the data available from official sources. The unpaid balance, till today (February 6) for the season 2020-21 is ₹10,430 crore till Thursday. Besides, the some mills have to pay a sum of ₹1,207 crore and an interest amount of ₹750 crore to the farmers towards the previous season’s cane price.

Loan repayment issues

“Though I have supplied 15 tonnes of sugarcane till date, I have received no payment so far. The delay in payment is making it difficult for me to repay the loan I have taken from the cooperative society towards the purchase of fertilisers. As a result, the cooperative society has already a higher rate of interest on the ₹1-lakh loan,” said Mahinder Singh, a marginal cane farmer .

Jitender Hudda, a farmer in Shamli, said sugar mills have already purchased more than half of the current season’s produce, but the government is still to declare the SAP. Some mills are making payment at the previous year’s rate, but not all. Similarly, a large number of farmers are yet to get payment for the previous season, Hudda said.

According to Pushpendra Singh, President of Kisan Shakti Sangh, who is among the farmers protesting against Central farm laws at Gazipur border, the UP farmers are angry at the Yogi government for this. With the increase in diesel price as well as electricity charges, apart from rising input costs, the farmers are really finding it difficult to make two ends meet.

In 2020, the UP government decided to increase the price at which electricity is supplied for tube well irrigation from ₹1,050 per 10 HP (horse power) to ₹1,875 per month. The farmers with smaller motors suffered the maximum as the government decided to club those with 5HP and 7.5 HP motors and put them in a higher slab. “Before 2017, I used to pay less than ₹300 a month, but for the same motor I pay ₹1,875 now,” said a farmer.

Published on February 05, 2021

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