It was an industry that began in the early decades of the 20th century in northeastern Uttar Pradesh — especially Gorakhpur, Basti and Gonda districts — and remained overwhelmingly concentrated there until Independence. But UP’s “sugar belt” today is largely in the state’s west/northwestern parts that vote in the first two phases of the current assembly elections.
Of the 140 constituencies going to polls on February 11 and 15 — UP has 403 seats — 104 are in the Upper Doab (the region between the Yamuna and the Ganga covering Saharanpur, Muzaffarnagar, Shamli, Meerut, Baghpat, Hapur, Ghaziabad, Gautam Buddh Nagar and Bulandshahr), Rohilkhand (the equally fertile upper Ganges alluvial plains from Bijnor, Moradabad, Amroha, Sambhal and Rampur to Bareilly, Badaun, Shahjahanpur and Pilibhit), and Lakhimpur Kheri (UP’s largest district) across the Gomti.
These three regions house 77 of UP’s 116 sugar mills, with an aggregate cane crushing capacity of 511,165 tonnes per day or over 68 per cent of the state’s total. In the last 2015-16 sugar season (October-September), they together crushed 468.77 lakh tonnes or almost 73 per cent of cane handled by all mills in UP.
Taking an average holding of one hectare and yield of 65 tonnes per hectare — of which 25-30 per cent is used as seed, feed or for supplying to makers of alternate sweeteners (gur and khandsari) — there would be over 10 lakh cane-farming families delivering to mills in the main “sugar belt” that votes on February 11 and 15. In addition, there are those engaged in cane harvesting — a single labourer working all day can, at best, cut and bundle 7-8 quintals — and 2,000-2,500 people in each of the 77 mills, employed either directly or as loaders and transporters. The cane growers belong to diverse communities: Jat (mostly in the Upper Doab plains, Amroha, Sambhal, parts of Bijnor and Moradabad), Gujjars (across Upper Doab), Saini (Saharanpur, Muzaffarnagar, Bijnor, Moradabad, Sambhal), Rajput (Saharanpur, Muzaffarnagar, Meerut, Bijnor, Moradabad, Shahjahanpur, Lakhimpur Kheri), Muslim (spread through Upper Doab, Bijnor, Moradabad, Sambhal, Rampur, Badaun), Kurmi (Rampur, Bareilly, Pilibhit, Lakhimpur Kheri), and Yadav (Badaun). The harvesters are predominantly Dalits and Muslims.
But for all this — not to speak of the crisis the sugar industry has been through in recent times — ganna and chini have hardly been campaign issues this time.
The Samajwadi Party’s silence is understandable because, during its tenure, the state-advised price (SAP) of sugarcane was raised only in 2012-13 (from Rs 240 to Rs 280 per quintal) and 2016-17 (from Rs 280 to Rs 305/quintal). During the three seasons in between, not only was there no increase, but farmers in UP did not receive even the unchanged rate in time. When the 2015-16 season ended on September 30, they were still owed Rs 1,539 crore out of the Rs 18,003 crore-worth cane purchased by mills at least six months earlier.
Adding insult to injury was the Akhilesh Yadav administration’s decision in May 2015 to waive interest of Rs 1,306 crore on delayed cane payments by mills for the 2012-13 and 2013-14 seasons. This was followed by a similar waiver, in October 2016, on interest of Rs 710 crore payable for 2014-15. The exemption was given despite the UP Sugarcane (Regulation of Supply and Purchase) Act of 1953 entitling growers to an annual interest of 7.5 per cent for any delay in SAP payments beyond 15 days from the date of cane delivery. For 2015-16, mills were even allowed to pay the Rs 280/quintal SAP in two instalments: the first Rs 230 within 14 days of delivery, the balance Rs 50 not later than three months after completion of crushing operations by April.
Yet, this raw deal to growers has not really been flagged as a poll issue, even by the main Opposition.
“The BJP’s focus is on palayan (the alleged forced exodus of Hindu families) when our major concern is over bhugtan (payment)”, notes Jitender Singh Hooda, an eight-acre farmer from Kheri Bairagi village in Shamli. The BJP manifesto promises to clear all pending dues of growers within 120 days and ensure future payments in less than 14 days of cane supply. “Why a new law when there is already a 63-year-old Act requiring mills to pay within 14 days? And what is this pledge of wiping out arrears in 120 days in consultation with banks and mills? Whom are they trying to please?” says V M Singh, president of the Rashtriya Kisan Mazdoor Party, which is contesting in about 20 seats “not to win, but to make a point”.
Equally intriguing is the BSP. The Mayawati government nearly doubled the cane SAP from Rs 125 per quintal in 2007-08 to Rs 240 in 2011-12 and, moreover, strictly enforced payment by mills. Also, it did not allow any imported raw sugar to enter UP for processing by factories during 2010-11, even after the then UPA regime at the Centre had permitted such imports at zero duty.
Yet, despite this record, the BSP has not aggressively courted cane growers, possibly because they are not seen as constituting its “core” votebank. The only party that has sought to make cane payments a major poll plank — even forcing mills to shell out interest on past dues — is Ajit Singh’s RLD. Whether this would help attract enough votes, not just of Jats — the party’s traditional support base that switched to the BJP in the 2014 Lok Sabha elections — but also other farming communities, however, remains to be seen.
The current 2016-17 season has actually been a good one for UP’s sugar industry. The state is set to produce 80 lakh tonnes-plus, sugar, as against 68.23 lakh tonnes in 2015-16. This, even as India’s output may dip from 252 lakh tonnes to just over 200 lakh tonnes, thanks to the impact of back-to-back droughts in Maharashtra and Karnataka. UP mills have also benefited from ex-factory prices recovering to an average of Rs 36.5-37 per kg from the lows of Rs 22.5 in July 2015. The 770-780 lakh tonnes they would crush this season would be worth roughly Rs 24,000 crore at the SAP of Rs 305/quintal for “general” and Rs 315/quintal for “early-maturing” varieties.
But farmers aren’t happy. “Given the cane shortages elsewhere, we were looking to make some money after four bad years. But because of demonetisation, the kolhus [which produce gur] could barely run. So, we were forced to sell most of our cane to the mills, which have benefited both from demonetisation and higher sugar realisations,” says Hooda.
Data from the Cane Commissioner’s Office in Lucknow shows mills to have made cane purchases valued at Rs 15,067.87 crore as on February 7, against which Rs 3,087.88 crore of payments are due beyond the stipulated 14 days. This is over and above the arrears for the 2015-16 season.