Government’s decision to give freedom to the sugar industry to sell sugar on commercial consideration and removal of the burden of levy sugar are extremely important and crucial. As suggested by the Rangarajan Committee, these decisions will help the industry to achieve its potential growth of 20-25% per annum.
Removal of the burden of levy sugar will give the industry an annual savings of Rs. 3000 crore, whereas abolition of regulated release mechanism will reduce inventories and ensure better cash flows. These much awaited reforms will reduce the cost of production and improve liquidity with millers which, in turn, will ensure better and timely payment of cane price to farmers as also assure better quality sugar, at reasonable prices on a sustained basis, to the consumers.
Abolition of regulated release mechanism and removal of the burden of levy sugar from the industry will improve timely payment of remunerative price to the farmers which, in turn, will control the infamous sugarcane and sugar production cycle, known to badly hit all the stakeholders, including, farmers, millers as well as the consumers. These two important reforms will go a long way in improving efficiencies both at farm and mill level and make Indian sugar competitive in the international market.
The reforms approved by the Government for this very important sugar sector in India will make the sugar industry more viable as well as attractive and bankable, which will attract large scale investments both from within the country as well as from abroad. This will improve efficiencies, give better returns to the farmers as well as improve sugar availability and quality for the consumers. The industry, and I am sure the farmers as well as the consumers too, welcome this important and historical decision of the Government to free the sugar sales from the age-old unnecessary and archaic controls.