Legal action to be taken against them if they fail to deliver

The State Sugarcane Control Board on Monday issued a two-day ultimatum to sugar factories to pay the arrears to sugarcane growers as per the price fixed by the government (Rs. 2,500 a tonne).

Briefing presspersons after a marathon meeting with sugar factory owners, Minister for Sugar Prakash B. Hukkeri, who is also the chairman of the Sugarcane Control Board, said it would be inevitable for the government to initiate civil and criminal proceedings against the factory owners if they fail to clear the farmers’ dues.

Of a total due of Rs 9,247.71 crore (as on April 15 this year) to growers, Rs. 3,357.56 crore is still to be cleared. “We appeal to the factories to clear this along with last year’s arrears of Rs. 34.15 crore (a total of around Rs. 3,391 crore) to the growers within the next two days or face action,” he said.

He said the government had to strictly follow the rules and initiate action as per the directions of the Karnataka High Court.

Talks fail

Talks between the government and the sugar factory owners had failed, following which the court had asked the government to act as per law.

Minister for Law T.B. Jayachandra said following the court’s directions, Chief Minister Siddaramaiah had directed the Sugarcane Control Board to have another meeting with the owners and convince them to pay the dues. “We have told them at the meeting today (Monday) that they should pay before legal action is initiated against them. If there is no quick response, action is imminent,” he said.

Minister of State for Agriculture Krishna Byre Gowda explained that the Union government had released a soft loan of Rs. 1,067 crore as part of the bailout package to the factory owners to enable them to pay arrears to the growers.

Moreover, last year’s recovery rate of 10.35 per cent had increased to 10.98 per cent this year. Apart from this, the sugar price had gone up from Rs. 26 per kg (when the minimum support price was fixed in November) to Rs. 31 per kg now.

The members said till last year, factory owners had to pay 10 per cent of the total production of 40.66 lakh tonnes at Rs. 13 a kg. But the commodity is levy free now, they said.

Another meeting

Vidya Murukumbi, founder member of Renuka Sugars, who participated in the meeting, said that representatives of the factory owners will meet again in a day or two and convey their stand to the government. “We are not averse to abiding with the board’s directions as market price of sugar is improving. However, we will transfer the benefit to farmers in proportion to the market price,” he said.

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