Growers in bind, Punjab declines help to pvt mills
PUNJAB FINANCE DEPT SAYS IT HAS NO FUNDS TO BRIDGE GAP BETWEEN STATE AND CENTRE’S PRICES
CHANDIGARH: Private sugar mill owners in Punjab have not started crushing cane this season, saying business is unviable as the state advisory price (SAP) of Rs 310 per quintal fixed by the state government to be paid to growers is higher than the Centre’s fair remunerative price (FRP) of Rs 275.
Eight of the nine cooperative sugar mills in Punjab started crushing cane on November 15 but the private mills, which crush 70% of the state’s cane produce, are waiting for the government’s commitment to bridge the gap between the SAP and the FRP. They were in for a shock with Punjab chief minister Capt Amarinder Singh declining any help after he met agriculture and cooperation department officials on Tuesday. Instead, the chief minister proposed strict action against private mills for the non-payment of dues to farmers and directed the finance department to release another instalment of Rs 35 crore to the cooperative department for clearing dues of growers.
“The private mills have to make their own arrangements . The government will be reviewing the cases of mills closely,” additional chief secretary Vishavjeet Khanna said.
Farmers are expecting a bumper crop this time but they are in a bind with payments of the previous season pending and the crop ready for harvest. They have been protesting against the government and the mills for delay in clearing their dues but in vain.
NO RELIEF IN SIGHT
In the 2017-18 crushing season, of the 842 lakh quintals of sugarcane crushed, private mills crushed 618.56 lakh quintals, while the share of cooperative mills was 223.54 lakh quintals. Of the total dues of Rs 2608.65 crore, the private mills owe Rs 1915.93 crore after paying Rs 1714.56 crore so far.
Before the state top brass decided to ask private mills to fend for themselves, the finance department expressed its inability to pay the compensation of Rs 500 crore.
All 16 sugar mills – nine cooperative and seven private – owe Rs 393 crore to the farmers. Mills in the cooperative sector owe Rs 192 crore and private ones Rs 201 crore.
“We see a worst case scenario this year because the SAP is higher than the FRP and it doesn’t make business viable. It’s better if we shut the mills,” says Jarnail Singh Wahid, the president of the Private Sugar Mills Association.
In 2014-15, the government arranged a soft loan of Rs 250 crore for private mills and it paid a subsidy of Rs 50 per quintal for farmers in 2015-16.
Rana Inder Singh, the managing director of a mill at Butter Sevian in Gurdaspur, said, “Sugar is selling for Rs 3,000 a quintal in the wholesale market. How can mills procure raw material at a higher price? 9.5 to 10 kg of sugar is produced from a quintal of cane grown in Punjab.”
He demanded that the SAP to be brought at a par with FRP because sugar prices are decided as per the latter.
FARMERS FACE BRUNT
At present, sugarcane is sown in 2.5 lakh acres against last year’s 2.35 lakh acres when the total production touched 842 lakh tonnes. This time, the production is expected to touch 950 lakh tonnes.
“We have not signed agreements with farmers this season which means they have to make their own arrangements,” said Wahid.
Balbir Singh Rajewal, the president of a faction of the Bharti Kisan Union (BKU), said, “In the end, it’s the farmers who have to suffer as after the harvest there will be a glut and mill owners will take away produce at rates much lower than the SAP.”
“I have 40 acres of sugarcane crop but I have planned not to grow it in the next season,” says Sukhjinder Singh Pamah Kalan near Samrala. The cooperative mills in Budewal owe him Rs 22 lakh from the previous season.