The bitter tales of Shamli’s sugarcane farmers: ‘Netas talk palayan (exodus), our issue bhugtan (payment)’

Even though Shamli tops in sugarcane production, there is nearly Rs 300 crore dues for district farmers.

Written by Harish Damodaran | Shamli/kairana | Updated: June 20, 2016 5:18 am
shamli, kairana, uttar pradesh, up sugracane farmers, up surgarcane cultivation, up sugar mills, up sugarcane farmers dues, up farmers sugar mills dues, shamil sugar mill dues, uttar pradesh sugarcane sap, sugarcane farmers debt, sugarcane farmer crisis up, shamli exodus, kairana exodus, uttar pradesh news, india news, latest news A sugar mill in Shamli, UP; farmers delivered 193.1 lakh quintals last season. (Source: Express photo by Praveen Khanna)

Mohkam Singh supplied 22 buffalo carts of cane, each laden with 18 quintals, to the sugar mill at Shamli belonging to Sir Shadi Lal Enterprises Ltd in the 2015-16 crushing season. These 400 quintals should have fetched about Rs 1.12 lakh at the Uttar Pradesh government’s state advised price (SAP) of Rs 280 per quintal.

But all that this 17-bigha (2.9 acres) farmer from Kheri Bairagi village of Shamli tehsil has got so far, even after the mill stopped crushing on April 17, is Rs 44,000.

The 70-year-old’s main worry is about his grandson and granddaughter, who are studying in class VII and class IX, respectively, at a private school in Shamli town. Their combined monthly fee of Rs 3,000, inclusive of school-bus charges, hasn’t been paid since March.

“Neta log palayan ka mudda utha rahe hain. Yahan ganna kisan pis raha hai, magar bhugtan ke bare mein koi zikr nahin ho raha hai (Politicians are raising the issue of exodus. Here, cane growers are being crushed and yet no one’s mentioning about payments by mills),” said Singh.

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Mohkam Singh is just one of Shamli’s 76,500-odd farmers who delivered 193.11 lakh quintals of cane to the district’s three mills – which also include Bajaj Hindusthan’s Thanabhawan and Rana Sugars Ltd’s Unn units — in the last sugar season.

This total sugarcane was worth Rs 538.46 crore at the official SAP, whereas the three mills together have up to now disbursed only Rs 240.70 crore. That works out to nearly Rs 300 crore dues for a single district.

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This region is currently in the news for BJP MP Hukum Singh’s allegations of an exodus of Hindu families from Muslim-majority areas like Kairana and Kandhla — The Indian Express had reported that those who left did so years ago for better job opportunities and education.

“The SAP has been unchanged at Rs 280/quintal since 2012-13 and we are not getting even that. The palayan (exodus) is only intended to divide and divert from the real problem of bhugtan (cane payment). It’s being done now, as the timing — when crushing is over and before Assembly elections early next year — suits both mill-owners and politicians,” said Jitender Singh Hooda, who farms 45-bigha (7.6 acres) in the same village and has received Rs 1.44 lakh for his 1,200 quintals supplied to the Shamli mill, as against its SAP value of Rs 3.36 lakh.

Shamli lies in western UP’s Upper Doab region, the fertile alluvial tract between the Ganga and Yamuna that is synonymous with sugarcane cultivation. “Ours is the top district in cane productivity. But unfortunately, we are also now topping in cane payment arrears,” said Hooda.

He isn’t wrong. For 2015-16, Shamli’s average cane yield of 807.76 quintals per hectare, based on official crop cutting experiment data, was not just higher than the 665 quintal figure for the entire state, but even that of neighbouring districts like Saharanpur (667.48), Muzaffarnagar (759.40), Baghpat (770.32) and Meerut (794.68).

However, while mills in the latter districts have paid between 56 to 72 per cent of the SAP value of cane purchased, the ratio is below 45 per cent for Shamli.

“Unko toh paisa rokne ki aadat ban gayi hai (They’ve got used to blocking our money). Farmers are today borrowing money to make ends meet, while mills are getting cane on credit at zero interest from us,” alleged Jagmer Singh Nirwal, who holds the state record of harvesting 1,989.5 quintals per hectare in the 2014-15 season.

Owning 300 bigha (50.5 acres) in Shamli’s outskirts, half of it planted to cane, Nirwal and his three brothers delivered around 8,000 quintals worth over Rs 22 lakh to the Shamli factory. But even they have received only about Rs 4 lakh and haven’t got anything for cane supplies after January 15.

It’s not farmers alone, who are affected. “This district’s whole economy revolves around cane. If farmers aren’t paid, it impacts their spending and, in turn, our incomes as well,” said Sonu Sangal, a third-generation provision store owner in Shamli’s Mill Road, who claims his daily sales in cash is today barely a tenth of the Rs 30,000-40,000 it used to be till three years ago.

“This phenomenon of delayed cane payments has been going on since 2013-14. Initially, farmers were using Kisan Credit Card (KCC) money, meant for purchase of seed, fertiliser, chemicals and other agricultural inputs, to meet household expenses. But they have exhausted that option and are living hand to mouth,” said Amit Bansal, who has a shop in the same street hawking Patanjali Ayurved’s herbal products. His business, too, is down 40 per cent over last year.

Shamli’s primarily agrarian economy, currently in deep crisis mode, is also reflected in its banks.

Public sector, private and cooperative banks had outstanding advances of Rs 2,224.77 crore as on March 31 in the district, of which Rs 1,617.56 crore or 73 per cent was to agriculture. Within that, Rs 1,304.69 crore represented loans taken against KCC, a facility to meet short-term credit requirements for crop cultivation. Under it, sugarcane farmers can borrow up to Rs 1.40 lakh for every hectare of land owned, while being eligible to a concessional interest rate of 7 per cent. The subsidised credit is subject to a Rs 3 lakh limit and also the farmer repaying the borrowed amount with interest within a year. This money he needs to, however, deposit with the bank for only 24 hours before it can be withdrawn again.

But Shamli’s farmers, it seems, are unable to renew their KCC accounts within the due dates. Y P S Panwar, a consultant with Punjab National Bank’s financial literacy and credit counselling centre here, estimates that 55-60 per cent of agricultural loans in the district have turned “irregular”. Farmers earlier often borrowed from each other to park the required sums for 24 hours just to maintain their KCC limits-cum-interest subsidy eligibility.

“But when no one is getting paid for their crop, who do you borrow from? There was a time when farmers used to come running to pay up when banks used to send overdue notices even by ordinary post. But today, they know nobody has money and there’s no point trying to save face,” said Panwar.

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  1. I
    May 1, 2017 at 10:01 pm
    1. O
      Ordinary Indian
      Jun 20, 2016 at 12:12 am
      These are two separate issues... both important. Non payment of the agri production should be taken to the court and state regulators. There's surely a rat there. lt;br/gt;lt;br/gt;The issue of exodus is a separate long term issue and ignoring it will be creating another kashmir. It's an issue of an appropriate party that cares.
      1. V
        Jun 20, 2016 at 4:43 am
        The other day the Indian Express carried a picture of our honorable Chief justice chief justice with his comment which went some thing like this " the supreme court will take sumo motto action is the government does not do the right thing"lt;br/gt;I would humbly submit to his honour's attention the plight of the sugarcane farmer's plight not only in UP but also in Karnataka. The statistics will reveal how many sugarcane farmers have committed suicide due to the cash crunch caused by non payment for their produce by the big sugar mills owned mostly by netas of all hues and politically well connected up four or five years.They are treated as beggars and pests when they request for what is owed to them.This situation is not going to get resolved by the politicians in the farmers favour anytime soon as the fence itself is eating the corps.I respectfully enquire his lordship's view on this appalling situation and request him to take some sumo moto action that he prescribed..
        1. V
          Jun 20, 2016 at 5:27 am
          There is only one way the farmers can overcome this injustice.That is to get united to form a cooperative and charge cheque with order for the canessold. No money no canes.If they are united this way then they can find buyers far and wide who will pay for the stock up front.The problem here is that a single small holder has no bargaining power and pay his farm inputs. Since his cash flow is held up he works on credit at the terms and conditions set by the local banks which are draconian to say the least.If they default in their payment the bank can and will will sell the farm to to recoup the debt with interest.The bank do it because it is easy, Firstly, the cannot afford the bus fare to the city to see a lawyer. Secondly the law allow the farmer to be treated as a willful defaulter. This 150 year old law cannot distinguish as to how the debt was incurred and how and how these dirt poor farmers became wilful defaulters as opposed to somebody who were given loans on a platter and ran away with it. If the honourable CJC has meant what he said "if the government does't do what is right then the judiciary must step in." Sir here is your opportunity to remedysomething very very wrong.
          1. V
            Jun 20, 2016 at 5:59 am
            Our prime minister and cabinet would very well know that "Charity begins at home and our sugarcane farmers deserve charity in the form of proper regulations, more urgently, than any other section of Indian society.No good can come by apportioning blame on this or that government or explaining away this dire situation with immaginative sematics.Please get in there and give our farmers a leg up.
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