The Karnataka State Sugarcane Growers’ Association said that giving an interest-free loan of Rs. 6,600 crore to sugar mills would not solve the problems faced by sugarcane growers across the country, as the mills owed Rs. 21,000 crore to cane growers in the country.
With the current amount, sugar mills could not give even 20 per cent of arrears to farmers, the association said. It expressed disappointment over the government not making an in-depth study before taking a decision.
Purchase surplus stock
Kurubur Shanthakumar, president of the association, told The Hindu that the Union government should purchase over 25 lakh tonne surplus stocks of sugar in sugar mills, which could be stored in warehouses as buffer stock. The government should pay the amount to cane growers instead of to sugar mills, he said.
‘Neglected growers’
Mr. Shanthakumar wondered why the government had neglected cane growers. If cane growers were not paid the amount for the cane supplied by them to the sugar factories, how they would continue to grow cane, he asked, noting that most cane growers had borrowed money from banks and private financiers. The sugar factories had ‘looted’ money when the prices of sugar had gone up a few years ago, he said.
It was the duty of sugar factories to settle the arrears of cane growers for the cane supplied, irrespective of surplus stock and the decline of about Rs. 4 per kg in sugar prices.
Surplus sugar produce in the last three seasons had led to accumulated stock of 91.09 lakh tonnes on October 1, 2014.
The State government had failed to prevail upon sugar factories to settle the arrears of the farmers despite the fact that some farmers had committed suicide in the State, he rued.
Five-year loan
Last Thursday, the Centre decided to extend a Rs. 6,600-crore interest-free loan to the sugar industry for payment of cane arrears to farmers. The loan can be paid back in five years, with a moratorium of two years.
The Union government should purchase
over 25 lakh tonne surplus stocks of sugar in sugar mills, which can be stored as buffer stock
Kurubur Shanthakumar
Karnataka State Sugarcane Growers’ Association
