The MAHARASHTRA government Wednesday agreed to a proposal made by the sugar industry to increase the tariff at which the government purchases power from co-generation plants in the state.

Cooperatives Minister Chandrakant Patil said the government would now pay Rs 6.59 per unit to sugar mills. The sugar mills were previously paid Rs 6.27 per unit.

The decision will burden the state exchequer by Rs 50 crore.

Patil announced the decision following a meeting with BJP MP Sanjay (Kaka) Patil and Swabhimaani Shetkari Sanghatana MP Raju Shetti. The former runs a cooperative sugar mill while the latter has been raising issues concerning cane producers.

Sugar factories have been struggling to pay farmers fixed remunerative prices for cane due to a global decline in the sale prices of sugar.

The sugar lobby, which enjoys considerable clout with the government, has now got the Maharashtra government to increase the returns from the sugar byproducts to increase turnover.