MEERUT: With the Allahabad high court's July 15 deadline for payment of 75% sugarcane arrears four days away, sugar mill owners in the state told TOI it is practically a given that they will miss the deadline.

"It is almost certain that we will default on payments on the deadline. Sugar prices have been in free fall. The industry is in a crisis and we have been facing huge losses. There is an unfavourable gap of Rs 10 between the selling price of sugar and the cost of production. At a time when sugar prices are not rising, we can't possibly pay 75% of the dues by July 15," said Deepak Guptara, secretary of UPSMA.

Guptara said the Centre's loan worth Rs 6,000 crore to mills to pay their dues to farmers has not been distributed yet. "The loan has only been announced so far. The money has not been given to mills yet. We think it will only be made available by September, even though the HC deadline is four days away. The loan by the government for the sugar industry, with a one-year moratorium, will not address the basic problem of surplus sugar and depressed prices. We received a similar loan in February 2014 and the government promised to bear the interest on the loan for five years. Now, the government will bear the interest for just one year. This loan will not really be interest-free," he said.

Last month, Meerut divisional commissioner Alok Sinha had said that mills which didn't pay 75% of their dues by July 15 might be auctioned off. Sinha has now said the administration will also positively reinforce mills that make payments on time. "Mills must pay their dues according to the directives of the high court. 85% of the money earned from the sale of sugar should be used to repay farmers. Mills that repay farmers at the rate of Rs 240 per quintal will get a rebate of Rs 8.60. This money will go straight to farmers' accounts," the commissioner said.

Deputy cane commissioner Vishwesh Kanaujia said, "The arrears for the year 2013-14 have been paid and 75% arrears for 2014-15 must be paid by July 15. Mohiuddinpur sugar mill in Meerut has paid all its dues at Rs 280 per quintal and Sakoti sugar mill has paid all its dues at Rs 240 per quintal. Mills in Meerut division have to pay a total of Rs 1271.36 crores to farmers."

Farmers' outfits hit out at both the central and state governments. Kuldeep Tyagi of the Bharatiya Kisan Andolan (BKA) said, "If the state government can't even ensure that mills follow the orders of the Allahabad high court, it has no right to stay in power. If 75% of the dues are not paid byJuly 15, chief minister Akhilesh Yadav should resign and governor Ram Naik must dismiss the government."

Vinod Jatoli, president of the Bharatiya Kisan Union said, "There is a lot that the Prime Minister can do apart from sanctioning funds for smart cities and bullet trains. There is already a crisis since mills have refused to buy any cane this year. They can at least buy all the leftover sugar to help mills get back on their feet and hence help farmers. Even now, they can help mills make products such as ethanol from sugarcane. It is never too late."