Worried that mounting sugarcane arrears may hit its electoral prospects in politically-important States of Uttar Pradesh and Maharashtra, the Centre on Thursday decided to hike minimum selling price (MSP) of sugar by ₹2 per kg to ₹31.

 

“We have increased the minimum selling price of sugar from ₹29 per kg to ₹31 per kg. This will help sugar mills to pay dues to cane farmers,” Food and Public distribution Minister Ram Vilas Paswan told a press conference here. Sugar mills owe around ₹20,000 crore to sugarcane farmers till the end of January.

 

The decision comes following demands from the industry and representation made by NCP chief and former Agriculture Minister Sharad Pawar to Prime Minister Narendra Modi.

 

According to the Indian Sugar Mills Association, sugar production during the current sugar season, ending coming September, is estimated to be 30.7 million tonnes.