The area under sugarcane cultivation is expected to shrink substantially in Erode district during 2015-16 to 19,000 hectares from over 22,000 hectares last year.
Due to the crisis confronting the sugar industry caused by the Centre’s pricing policy, the area under sugarcane cultivation fell to 3.5 lakh acres during 2014-15 from five lakh acres in the previous year.
Both the mills and the farmers in the country have been subjected to sufferings due to the downslide in the wholesale price of sugar in the open market that now rules at Rs. 24 per kg.
But, the situation in Tamil Nadu is precarious due to levy of purchase tax, due to which surplus sugar is reportedly dumped from neighbouring Karnataka.
Mills in Tamil Nadu that owe farmers Rs. 600 crore dues have apparently chosen not to comply with the State Administered Price.
In addition to the Fair and Remunerative Price of Rs. 2,200 per quintal fixed by the Centre, Tamil Nadu has fixed the State Advisory Price at Rs. 350 per quintal.
But, unlike other States in the country, Tamil Nadu Government has not enforced the SAP. The approach of the State Government that professes support to farmers is confounding, the cultivators complain. For the last two years, the State Government has not convened tripartite meetings involving representatives of mills and farmers for fixing or enforcing SAP.
“Mills have the luxury of enjoying profits when the situations are conducive and passing on losses to the farmers by withholding payment of dues at times of crisis. It is always the farmers who are at the receiving end,” says K.V. Ponnaiyan, president of Tamil Nadu Swadeshi Farmers’ Association.
The farmers have called for a multi-pronged strategy by the Central Government to address the glut situation caused by easing import restrictions despite accumulation of surplus production.
Against the requirement of 230 lakh tonnes, India’s sugar production has been 250 lakh tonnes in the last four years. Despite there being an accumulation of 80 lakh tonnes, sugar is freely imported at cheaper costs.
The Commission for Agricultural Costs and Prices determines the remunerative price for sugarcane based on the base price of Rs. 32 per kg sugar. The Central Government has subjected the farmers to sufferings by subjecting sugar price to vagaries of globalisation. There is no reason why the Centre should hesitate to emulate the practice in USA where the Government fixes the cost of both sugarcane and sugar, Mr. Ponnaiyan explains.
Sugarcane farmers will be doomed if the Centre fails to take decisive actions by way of calibrating import duty to suit domestic production on the one hand, and prevailing upon mills across the country to settle the Rs. 20,000 crore of dues to farmers on the other. The Centre has the option of extending financial assistance as soft loans to the mills out of the Sugar Development Fund for settling the dues of farmers. Making farmers alone the ultimate sufferers in the crisis situation is outrageous,” Mr. Ponnaiyan says.
Downslide in wholesale price of sugar in open market
Situation in T.N. precarious due to levy of purchase tax
Farmers have called for a multi-pronged strategy by the Centre to address the glut situation caused by easing import restrictions
