Package for sugar mills cleared

Cabinet clears Rs. 5,538-crore proposal that includes higher production aid to ryots For the fourth time in the last five months, the Centre has approved incentives to help the cash-starved sugar mills clear thousands of crore in arrears of payment to cane farmers. On Wednesday, the Cabinet Committee on Economic Affairs cleared a Rs. 5,538-crore package which includes higher production assistance to farmers, as well as transport subsidies for mills trying to export sugar. “We hope to bring the arrears down to zero with this package,” Food Minister Ram Vilas Paswan told reporters after the decision. Record harvests over the last two years have led to sugar production levels far above domestic consumption, resulting in a crash in prices and a liquidity crisis in the industry. “Due to excess carry-over stocks and indication of similar excess production in the ensuing sugar season 2018-19, the liquidity problem of the sugar mills is likely to persist in the coming sugar season too. As a result, cane price arrears of sugarcane farmers may also peak at unprecedented high level,” said an official statement on the Cabinet decision. Currently, the mills owe farmers more than Rs. 13,000 crore in arrears, down from a peak of more than Rs. 22,000 crore in May 2018.

Source : https://www.thehindu.com/todays-paper/tp-business/package-for-sugar-mills-cleared/article25052904.ece

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