Rajeev Chandrasekhar's official website - Member of Parliament

GOVERNMENT OF INDIA

Ministry of Consumer Affairs, Food and Public Distribution

 

DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION 

RAJYA SABHA

UNSTARRED QUESTION NO 3237

TO BE ANSWERED ON 04.05.2007

Sugar Factories

3237.

SHRI RAJEEV CHANDRASEKHAR

Will the Minister of CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION be pleased to state:-

(a) whether the Central Government are aware that sugar factories in Karnataka are not buying sugarcane from the farmers in the State and the growers have threatened to commit suicide as they would have to burn their crops in the fields and would not be able to re-pay their bank loans;

(b) if so, the action taken by the Central Government to defuse the crisis; and

(c) the extent of loss, so far, suffered by the farmers in the State due to refusal of the factories to buy the sugarcane and also due to late buying? 

ANSWER

MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND MINISTER OF STATE IN THE MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION
(DR. AKHILESH PRASAD SINGH)

(a): The Cane Commissioner, Government of Karnataka have reported that there are no instances wherein sugar factories in Karnataka are not buying sugarcane from farmers. However, farmers in certain areas of the State have threatened to commit suicide and burn their crops in the field.

(b)&(c): In order to ensure that over production of sugar does not lead to a situation of mounting cane price arrears, the Central Government on 24th March, 2007 have decided as under: -

(i) to create a buffer stock of 20 lac tons for a period of one year (01.05.2007 to 30.04.2008) under which interest charges, insurance and storage charges for the quantity taken as buffer will be reimbursed to sugar factories. The cost of this subsidy is estimated to be about Rs.378 crores for one year. Further, banks would provide additional credit of about Rs.420 crores on creation of 20 lac tons of buffer. Thus, about Rs.798 crores would be available with sugar factories to pay cane price to sugarcane farmers, for the sugar season 2006-07 including the cane price arrears of previous sugar seasons. The buffer subsidy and the additional credit are to be used for the payment of cane price.

(ii) to encourage exports, assistance has been provided to defray the internal transport and freight charges, marketing and handling charges at the flat rate of Rs.1350 per ton on export of domestically manufactured sugar from sugar factories situated in the coastal States and at the flat rate of Rs.1450 per ton from sugar factories situated in other than coastal States. Exports made under Open General License (not under `advance authorisation`) on or after 19th April, 2007 and upto 18th April, 2008 or till further orders, whichever is earlier, would be eligible for this assistance. The estimated cost of the export assistance is Rs.205 crores. This export assistance is to be used for cane price payment.