‘Farmers have nothing against me’

In this Idea Exchange programme at The Indian Express office, Sugar Commissioner Vijay Singhal talks about sugarcane pricing, the recent protests by farmers and the government's stand on the issue

Manoj More: We will begin with the latest controversy around the price of sugarcane. Can you explain the dispute, which led to protests that turned violent?

I will give you an overview of the issue. Both sugar and sugarcane are controlled commodities. The government decides the price of sugarcane, which is called Fixed and Remunerative Price (FRP). Earlier, it was SMP — Statutory Minimum Price (SMP). This FRP is a guaranteed price to be given to the farmer. At the national level, we have an independent body called Commission for Agricultural Cost and Prices (CACP), which, after considering various factors and discussing with various stakeholders, including agriculturists, sugar factories, unions and the government, fixes the FRP for that year. The body also studies the input cost for the crop and the realisation of sugar from the market and also the fact that had the growers gone for any other crop what price would they have got. So, the price calculation depends on these four-five factors. On the basis of this marathon exercise, they come up with a price, which is then fixed as the FRP for that particular year. Once they recommend it, the figure goes to the Ministry of Food and Consumer Affairs, after which it has to be cleared by the Cabinet. Once the Cabinet approves it, a formal notification is issued on the FRP. So, the FRP is the amount that has to be given to the farmers by virtue of the Sugarcane Control Order under the Essential Commodities Act.

The current controversy is because the farmers' leaders think the price fixed is much less and they are demanding a higher price as the cost of inputs and that of production have gone up. In Maharashtra, most sugarcane factories are cooperative. We know that cooperatives work on a principal of no profit and no loss. Also, in Maharashtra, the price of sugarcane is generally given in two-three installments. The first installment is something that shouldn't be less than the FRP. If the first installment is not given above the FRP, the sugar commission is empowered to take action against the erring factory. The first installment is paid after 15 days of getting the sugarcane in the factory. The second installment may be given after six to seven months or as and when the sugar factory gets the money. To pay to the farmers, the money should be available with the sugar factory.

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