Govt may form inter-ministerial panel on sugar decontrol

In order to fasttrack decontrol of sugar sector, the government is mulling setting up an inter-ministerial panel to review recommendations of the Rangarajan Committee on sugar deregulation.

The panel could be chaired by agriculture minister Sharad Pawar and ministers from finance, commerce, food and new and renewable energy ministries and the Planning Commission deputy chairman could be members in it, sources said. "The PMO is considering setting of an inter-ministerial panel on sugar decontrol to fast track implementation of some of the recommendations made in the Rangarajan Report," according to sources. 

At present, sugar is the only sector fully controlled by the government. The sector is regulated right from production through distribution in the open market and ration shops. In October, the PM-constituted committee led by PMEAC chairman C Rangarajan had submitted a report suggesting scrapping of major controls on the sugar sector.

The food ministry is considering implementation of some of the  recommendations, which do not require approval of the state-governments, by year-end. It has has sought views of the state-governments on the Rangarajan Report.

Barring two key regulations with respect to fixing sugarcane price and sharing of 70 percent revenue by sugar firms with farmers, the Rangarajan Report has suggested giving freedom to mills to sell sugar in the open market and having a stable export and import policy. It has recommended removal of obligation on the part of mills to supply 10 percent of sugar at cheaper rate to the government to meet the ration shops demand.

In the long-term, it has recommended doing away with the cane area reservation and minimum distance criteria between sugar mills besides suggesting removal of controls on byproducts like molasses.