The Empowered Group of Ministers (EGoM) on Food will meet soon, following a letter by Agriculture Minister Sharad Pawar to Prime Minister Manmohan Singh on curbs on milk, cotton and sugar exports. The EgoM is headed by Finance Minister Pranab Mukherjee.
Mr. Pawar shot off the letter to the Prime Minister after the EGoM earlier this week disallowed export of cotton beyond 13 million bales for the current marketing year. The Commerce Ministry holds that cotton exports have already exceeded targets.
However, Mr. Pawar wrote to the Prime Minister that compromising on the interests of small cotton farmers to benefit textile magnates was a “travesty of justice.” Moreover, permitting the consumer of cotton (Textiles Ministry) to dictate terms to the producer defied logic. Indian farmers should not be asked to bear the burden of subsidising the textile mills, he said.
The Minister criticised the Textiles Ministry led by Anand Sharma and the Food Ministry headed by K.V. Thomas for their “ambivalent policies” that went against farmers.
He said the “negative approach” of the Food Ministry to sugar exports led to heavy losses in export earnings which otherwise could have been utilised to clear cane arrears to farmers that have crossed Rs. 8,000 crore.
Mr. Pawar told the Prime Minister: “On numerous occasions I have discussed with you the need to have farmer-centric agriculture policy...On each of these occasions, I have found you in consonance with these ideas. However, despite this, our government has time and again taken the decisions which go against the interest of the farming community and adversely impact its growth and stability.”
He said negativity in the Food Ministry regarding export of sugar could be gauged from the fact that though the decision to allow sugar exports of 10 lakh tonnes was taken on March 26, 2012, no orders had been issued on it. It had been decided to export 30 lakh tonnes of sugar in view of higher domestic output but the last tranche was not yet notified and the advantage would be lost once Brazilian sugar came into the market.
“We must learn from the mistake of 2006-07 and 2007-08, when we spent Rs. 1,500 crore on transport and buffer subsidy to bail out the sugar industry and provide succour to the sugarcane farmers,” he said.
The department, he rued, was yet to come out with a methodology despite the EGoM decision to do away with the system of allocating quotas to sugar mills.
The Minister said the Centre's policy on milk and milk products had been equally ambivalent and demanded opening of export of skimmed milk powder and casein. He highlighted the fact that the country had achieved record production of foodgrains, cotton, sugarcane and oilseeds despite rising input costs.
He said it was not possible for the minimum support price to cover all costs and therefore, it was necessary for the government to allow a free trade market and trade regime to ensure remunerative price to farmers.
Gujarat Chief Minister Narendra Modi, who had also been opposing the restrictions on cotton exports, wondered on twitter whether the government would respond to its own Agriculture Minister. On Friday, Mr. Thomas declined to comment on the letter immediately but added that he had all the “facts and figures ready” on the sugar sector.
