Karnataka announces incentive of Rs. 150 per tonne of sugarcane

Factories failing to give Rs. 2,500 a tonne to face action

The State government, within hours of the suicide by a sugarcane farmer on Wednesday, announced an incentive of Rs. 150 per tonne of sugarcane. Chief Minister Siddaramaiah, addressing presspersons, said the incentive would be in addition to the already announced State Advisory Price of Rs. 2,500 per tonne of sugarcane.

While this is an ex-field price in north Karnataka where the factories will take care of the harvesting and transportation charges for the produce with an average sugar recovery percentage of 11 per cent, it will be an ex-gate price for the south Karnataka farmers, where they have to bear the cane-cutting and transportation charges for the produce, given the lower recovery rate.

Mr. Siddaramaiah said the incentive of Rs. 150 per tonne would result in an additional burden of Rs. 500 crore on the State exchequer. The State has already decided to waive value added tax, purchase tax and road tax being collected from sugar mills, to help them pay the State Advisory Price at a difficult time when price of sugar has dipped.

The Chief Minister said it is mandatory on the part of all the sugar factories to pay the full State Advisory Price. “If they fail to abide by this, the government will initiate stringent action against them under the provisions of the Karnataka Sugarcane (Purchase and Supply Control) Act.”