The state government on Monday directed sugar mills to release their export quota as per guidelines or forego special incentives awarded by the Centre and the state, including waiver on purchase tax on sugarcane. The incentives include soft loans with low interest rate for co-generation and tax exemption on purchase of sugarcane by mills.

“The emphasis on export of sugar is to ensure the domestic market doesn’t crash. At the same time, the remuneration from export of sugar would help the sugar mills to sustain and also extend better Fair Price Remuneration to the cane-growing farmers,” Chief Minister Devendra Fadnavis said.

Of the total sugar export of 40 lakh metric tonnes, Maharashtra has to provide 14 lakh metric tonnes. So far, state sugar mills have released only 3.80 lakh metric tonnes for export. Across the country, the total sugar for export too is low, not exceeding 5.6 lakh metric tonnes.

Every sugar mill is expected to release 12 per cent of its average three years’ production for export. The export is linked with the concessions given by the Centre and the state to the sugar sector to make it more robust due to uncertainty in the global and domestic markets.

NCP president Sharad Pawar, who attended the meeting, said, “The 12 per cent of the current production of sugar should be considered instead of taking an average of the last three years.”

Former energy and finance minister Dilip Walse-Patil recommended restructuring of loans to help the sugar mills and also farmers. However, considering the crisis in Maharashtra due to acute water scarcity for the fourth consecutive year, the state government is considering not to enforce the decision on incentive waiver on sugar mills operating in these regions.

The chief minister’s primary concern is to ensure farmers get better remuneration. Sugar mills too stand to gain. The sugar production for 2015-16 is estimated to drop by 25 per cent. It was 89 lakh metric tonnes the previous year. The production drop is essentially due to drought, which has led to huge crop damages and also discouraged farmers from taking up cane cultivation in a big way.