State to request Centre to abolish sugar levy

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The UP Sugar Mills Association has expressed its inability to pay Rs 290 per quintal as the state advised price to cane growers, saying it is "killing'' sugar mills.

The UPSMA has asked the state government to provide a cash subsidy of Rs 15 per quintal to the farmers directly, while its members will pay the remaining amount.

"In the last two years, the SAP has been increased by Rs 80 per quintal. There is a difference of Rs 40 per quintal from neighbouring states of Haryana and Punjab and Rs 60 from Tamil Nadu. It has been done for political gains but farmers will be the losers in long run," S L Gupta, general secretary of UPSMA, said on Thursday.

Since the sugar mills cannot pay the SAP, "it is better that the state government makes a payment of Rs 15 per quintal to cane farmers as cash subsidy'', Gupta stated.

The demand was raised by a UPSMA delegation during a meeting with Chief Minister Akhilesh Yadav and Samajwadi Party president chief Mulayam Singh Yadav on Wednesday.

On Thursday, the government, in a statement, said that Chief Minister Akhilesh Yadav assured the UPSMA delegation of taking up their issues with the central government, though it was silent on their demands related to the state government.

The statement said the state government will request the Centre for removing the compulsion of supplying 10 per cent sugar as levy and demand hike in the import duty of sugar.

The levy is given by the mills at a rate of Rs 1,900 per quintal while the cost of production, according to UPSMA, is around Rs 3,600 per quintal. "The levy only results in annual loss of Rs 1,000 crore to us," Gupta remarked.

The import duty on sugar is 10 per cent, so that imported sugar from Brazil and Pakistan costs Rs 3,200-3,300 per quintal. "The trader gets Rs 300-200 per bag as profit by importing sugar. This import duty should be increased to 60 per cent as it existed earlier in order to save the Indian industry," Gupta remarked.

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