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Monday, February 17, 2020

Pune: Think of total decontrol, Sharad Pawar tells sugar sector

“The (sugar) sector is operating for the last 60 years, and time has come to reconsider the norms and regulations of the sector. In the case of complete decontrol, the sector should be ready to bear the effects,” Pawar said.

By: Express News Service | Pune | Published: January 21, 2020 1:00:03 am
NCP chief Sharad pawar, Sugar Conclave, pune sugar sector, pune news, maharashtra news, indian express news NCP chief Sharad Pawar at the Sugar Conclave, in Pune on Monday. (Photo: Ashish Kale)

NCP chief Sharad Pawar Monday said the sugar sector should consider its complete decontrol. Addressing the Sugar Conclave, organised by Loksatta in Pune, the former Union agriculture minister said he was ready to lead a delegation to the government if a consensus on the matter was achieved.

“The (sugar) sector is operating for the last 60 years, and time has come to reconsider the norms and regulations of the sector. In the case of complete decontrol, the sector should be ready to bear the effects,” Pawar said.

Since its inception, the sugar sector has seen active participation of the government, both in terms of its share in capital required for setting up new mills and its guarantees in various stages of operations. The government also exerts control over the sector to ensure timely payment of Fair and Remunerative Price (FRP) to growers.

Since the last two seasons, the Centre has not only fixed the minimum selling price (MSP) of sugar but also fixed sugar sales quota for individual mills. This was to prevent glut in the domestic sugar industry, which otherwise would have led to a slide in the price at which mills sell sugar and a further financial crisis to them.

While the quota system has ensured sugar prices hover around Rs 3,100-3,150 per quintal, it has already resulted in a liquidity crunch for mills. Mills pointed out that they have not been able to cash in on the rising sugar prices and instead depend on banks to raise capitals to pay growers.

Pawar, however, said the industry should be ready to bear the effects of decontrol, especially when sugar prices come down.

The conclave saw senior sugar millers from across the state, as well as sugar technologists, discuss various aspects of the industry. Jaiprakash Dandegaonkar, chairman of Maharashtra State Cooperative Sugar Factories Federation Limited, highlighted the contribution of the sector to the economy of the state. “The government investment and guarantees might not be more than Rs 1,000 crore, but the sector has given returns manifold times to the government,” he said.

Dandegoankar said in 2004, 2015-16 and 2018-19, sugar mills had to take loans to pay the basic FRP. “If an industry has to take loans to pay for the basic raw material, it is not a good sign,” he said.

State minister for labour and excise and president of the National Federation of Cooperative Sugar Mills Dilip Walse-Patil (NCP) said the time has come to think of a long-term policy for the sector.

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