A series of initiatives aimed at ensuring speedy clearance of duesand timely imports along with use of stock limits helped prevent price spikes of sugar even during the just over festive season despite a low production of 20.3 million tonnes against yearly consumption of 24.5 million tonnes.
There have been hardly any report of sugarcane farmers from Uttar Pradesh, Maharashtra or Karnataka hitting the streets demanding payments as more than 99 per cent of dues have been cleared. This allowed the Centre and states to focus on other policy measures to ensure the demand supply situation did not get out of hand. Food minister Ram Vilas Paswan, who is also in-charge of consumer affairs, said his ministry did a balancing act and took all stakeholders into confidence. While retail prices have increased by less than 1.5 %, millers have been able to pay almost entire cane arrears of farmers. "Our focus was to ensure sugar industry survives, farmers get cane arrears in time and there is no major spike in sugar prices. The measures were part of a strategy from fixing stock limits for traders and industry, regulated import of raw sugar for specific regions and hiking and revising import duty," said a food ministry official.
The total sugar cane dues of farmers across the country for 2015-16 sugar season (October to September) is now at Rs 981 crore and for 2016-17 it is Rs 2,900 crore. Just in UP, of the total cane dues of Rs 44,530 crore for 2016-17, Rs 43,430 crore has been paid. Officials said steps to improve liquidity of sugar mills including incentivising export of large stocks, increasing import duty and providing loans to pay arrears besides initiatives to push ethanol production and assured prices had delivered results. Import duty was increased to ensure sugar prices don't crash.