The Maharashtra government will pay sugar mills Rs 1,000 per tonne as export subsidy. The move aims to help clear the rising sugar stocks in the face of weak global prices.
The decision, expected to make the state exchequer lighter by Rs 80 crore, is likely to be announced by the government on Tuesday. Maharashtra currently is the country’s biggest sugar producing state.
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- State sugar industry bleeds amid falling sugar prices, rising costs
- Rs 1600-cr subsidy to sugar sector not feasible, says Maharashtra government
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Weak global prices had led sugar mills, many of them controlled by senior politicians, to seek state government intervention and financial aid.
Industry barons had also demanded grants for sugar mills for paying fair and remunerative prices to farmers and building of a buffer stock but so far, the government has granted only subsidy for export.
Unable to meet input costs, a number of private sugar mills had shut operations in the midst of the cane crushing season. Sugar mills owe Rs 2,500 crore to farmers.
In a related development, an amnesty scheme for traders who have local body tax arrears is also on the cards. A government source, declining to be named, said the state cabinet is expected to formally roll out the scheme .
The government has decided to write off penalties and interest on payments for 2014-15 tax arrears, if traders make the payment prior to July 31, 2015.
The BJP election campaign in the state had promised to scrap LBT immediately after it came to power. Unrest among traders over non-implementation of this assurance was growing, and the government had, during the budget session of the assembly, announced scrapping of the tax from August 1.
Fadnavis, who holds the law and judiciary portfolio, is also expected to seek cabinet approval for setting up a bench of the Bombay High Court in Kolhapur, a long-pending demand of lawyers from Western Maharashtra.