Govt plans to review decades-old sugar production, pricing norms

The draft order details power of the government to regulate the production of sugar as well as restrict its sale, storage and disposal by producers and dealers.

The Union food ministry plans to revamp the nearly six-decade-old Sugar (Control) Order and has proposed to regulate the production of the sweetener as well as its by-products including ethanol.

The Ministry of Consumer Affairs, Food and Public Distribution has issued a draft 'The Sugar (Control) Order, 2024, and has sought comments from stakeholders by September 23.

The ministry said that there is a need to review the Sugar (Control) Order of 1966 due to the technological advancements in the production process.

"...there are multiple changes in the sugar sector which necessitates the revamping of existing the Sugar (Control) Order, 1966," said the ministry while issuing the draft.

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The draft order details power of the government to regulate the production of sugar as well as restrict its sale, storage and disposal by producers and dealers.

On power to regulate sugar output, the draft said that the Centre or the State can "direct that no sugar and its by-products shall be manufactured from sugarcane except under and in accordance with the conditions specified in a licence issued in this behalf..."

The draft defines by-products as any form of product which has been produced during production of sugar namely ethanol (produced from B-heavy/C-heavy molasses, sugarcane juice, sugar syrup, sugar), bagasse, potash based fertilizers, Compressed Bio Gas (CBG), C-heavy molasses, bio-electricity produced from bagasse, press cake or any other alternative product affecting sugar production from sugarcane.

"The Central Government shall, at the time of issuing any order regarding price of sugar for sale...take into consideration the fair and remunerative price (FRP) of sugarcane, approximate and average conversion cost for production of sugar from sugarcane/beetroot, average revenue realisation from by-products generated in the process of sugar production", the draft stated.

The draft also details power of the government regarding inspection, entry, search, sampling and seizure in relation to sugar production. It also specifies that the central government's power to restrict sale, storage and disposal of sugar by producers and dealers.

(With PTI inputs)