Tells EAC chief Rangarajan that the move will lead to sugar mills dictating the prices

Batting for about 30 lakh sugarcane farmers of Uttar Pradesh, Chief Minister Akhilesh Yadav has expressed his reservation over the Central government’s proposal to de-regulate the sugar and cane sectors, which would effectively signal an end to the State’s control over reserving the cane area of the sugar mills and fixing the procurement price for the growers.

In his meeting with the Chairman of the Prime Minister’s Economic Advisory Council, C. Rangarajan here on Saturday, Mr. Yadav made it clear that under no cost will the interests of the cane growers be overlooked by his government. Since a large number of people earned their livelihood from sugarcane farming, decisions related to the sector would be taken only after whetting all the aspects related to it, the Chief Minister said. Mr. Yadav felt the (private) sugar mills would get a free hand from procuring the produce and dictating the prices once the sector was de-regulated.

More importantly, the move was loaded with the possibility of the exploitation of the small and marginal farmers and will give rise to middlemen.

The Chief Minister’s meeting with Dr. Rangarajan and members of the EAC at his 5, Kalidas Marg official residence was held in connection with the proposal to de-regulate the cane and sugar sectors.

Sugarcane politics in Uttar Pradesh has always held centre-stage as the successive governments had wooed the strong cane farmers’ lobby through the State Advised Price (SAP) by enhancing the rates before the commencement of each crushing season, notwithstanding the stiff opposition from the equally powerful sugar lobby in the State. With the Samajwadi Party gearing up for the 2014 Lok Sabha election, the cane growers constituted a vital vote bloc. Mr. Yadav recently met a delegation of the Bharatiya Kisan Union (BKU), led by Rakesh Tikait, and is likely to visit Sisauli in Muzaffarnagar district (it is the largest cane producing district in U.P.) on October 6 for the unveiling of BKU founder Mahendra Singh Tikait’s statue.

Referring to the possibility of the sugar mills exercising their free will in the event of de-regulation, the Uttar Pradesh Chief Minister told the EAC members that it would give mills the option of procuring cane from the non-reserved cane areas of the factories, as well as from the mill gate, villages and procurement centres. “This was fraught with the possibility of the farmers of the reserved cane areas of the mills feeling resentful,” Mr. Yadav said. There is also a possibility of several sugar mills opening procurement centres in a particular village at the cost of other villages.

Mr. Yadav said the de-regulation of the cane areas would in all likelihood lead to the exploitation of the small and marginal farmers by the middlemen, who will purchase cane from these farmers at a low price, which would then be sold to the factories at a higher price. The Chief Minister expressed apprehension that the cooperative cane societies would gradually become irrelevant.