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Industry hails subsidy on sugar exports
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SME Times News Bureau | 17 Dec, 2020
The government has announced a subsidy of Rs 3,500 crore for the export
of 6 million tonnes of sugar in the current sugar season 2020-21
(October-September) under the scheme of Maximum Admissible Export Quota
(MAEQ) allocated to the sugar mills for the season. Sugar industry body
Indian Sugar Mills Association (ISMA) has welcomed the decision, saying
it would help reduce cane arrears.
The Cabinet Committee on
Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi on
Wednesday approved the financial assistance of nearly Rs 3,500 crore for
sugarcane farmers, said an official statement.
Briefing about
the decisions taken by the Union cabinet, Information and Broadcasting
Minister Prakash Javadekar said the CCEA has approved a subsidy of Rs
3,500 crore for the export of 60 lakh tonnes of sugar and the amount of
subsidy would be directly transferred to the farmers.
He also
said that a budgetary provision of Rs 5,361 crore for past subsidies has
been made which will be directly transferred to the bank accounts of
the cane growers.
Sugar production in the current season is
estimated at nearly 31 million tonnes while the domestic consumption is
nearly 26 million tonnes for the current year, therefore the domestic
price is low, said the minister.
At present, there are nearly
five crore sugarcane farmers dependent upon it across the country. In
addition to this, there are nearly five lakh workers employed in the
sugar mills, ancillary activities and their livelihood depends on the
sugar industry, he added.
This decision would benefit five crore
sugarcane farmers and their dependents, as well as five lakh workers
employed in the sugar mills and related ancillary activities, said the
statement.
Director General (DG) of ISMA, Abinash Verma, said,
"The sugar industry welcomes the much awaited decision on the sugar
export programme for the 2020-21 sugar season."
However, he said
that at the current world prices and even if there is a small correction
therein, sugar exports from India will be viable with the export
subsidy of Rs 6,000 per tonne, therefore the subsidy amount is lower
than last year but considering that the world sugar prices are higher as
compared to what they were at the same period in the last season, the
industry is confident to perform well again in 2020-21.
According
to Verma, even though two-and-a-half months of the current season is
over, considering that several large importing countries have been
enquiring about Indian sugar and also considering that the drop in sugar
production in Thailand gives an opportunity for India to export to
their traditional markets like Indonesia, Malaysia etc., the Indian
sugar industry should be able to fulfil the target of 6 million tonnes
of sugar exports in 2020-21.
"This will help reduce the sugar
stocks and from an opening balance of 10.7 million tonnes as on October
1, we should be able to reduce the carry forward into the next season on
October 1, 2021 to 9.6 million tonnes," he added.
The ISMA DG
said that 6 million tonnes would give the industry Rs 18,000 crore from
exports and subsidy, which will help reduce cane price arrears. Also,
the budgetary allocation of Rs 5,300 crore for past subsidies will
further help the sugar mills to clear their cane price arrears, he
added.
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