Food Minister Ram Vilas Paswan on Monday said cane arrears to farmers have reached around Rs 22,000 crore for the current season, and asked mills to clear it soon to improve farmers' cash flow situation amid the coronavirus pandemic. Paswan reviewed the cane arrear situation with his ministry officials, and also directed the secretary to submit a report suggesting ways to reduce arrears.
"Mills have to pay total Rs 72,000 crore for sugarcane purchased from farmers during the 2019-20 season (October-September). Maximum has been paid and the arrears left are about Rs 22,000 crore which we are asking mills to clear at the earliest," Paswan told PTI.
Arrears comprise of payments to be made on the basis of Fair and Remunerative Price (FRP) fixed by the Centre, and State Advisory Price (SAP) determined by the states, he said.
Of the Rs 22,000 crore arrears pertaining to 2019-20 season, about Rs 17,683 crore is based on the FRP rate, while the rest is based on SAP rates, he added.
The minister said the mills are yet to pay Rs 767 crore for 2018-19 season, and asked them to clear it in this season itself.
Paswan said sugar exports are taking place at a good pace during the current 2019-20 season with the help of incentives offered by the Centre, enabling mills to make payment to farmers.
Against the mandatory export quota of 60 lakh tonnes for the current season, mills have contracted shipment for 48 lakh tonnes. Of this, 43 lakh tonnes of sugar has been exported.
"This is a very good sign as the country was able to export only 37 lakh tonnes last season. We hope the export earned money will help mills in clearing cane dues to farmers," Paswan said.
Mills have been told to clear the dues before the season ends in September this year, he said.
Other options to help cash-trapped mills to clear cane dues were also discussed in the review meeting, but nothing has been finalised yet.
The food secretary has been asked to submit a report in this regard, Paswan said.
Mills have produced 27 million tonnes of sugar so far in the ongoing 2019-20 season, lower than 33.1 million tonnes achieved last year, as per the official data.
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