State releases Rs 351 cr to clear sugar cane dues

The state government has released Rs 351.14 crore towards payment to sugar cane growers as sugar mills have failed to clear their dues for 2013-14.

The finance department has released the money under the budget set aside for the agriculture department. A government order in this regard was issued on July 3.
The next installment would have to be released by the defaulting factories before July 31. In case the factories continue to be defaulters, then the State government would have to make the payment by auctioning sugar seized from the mills. 

The total arrears towards cane growers is about Rs 923 crore. Chief Minister Siddaramaiah had given an assurance last week to the  legislature that the government would release the first installment before July 10.

He had also said the factories would have to pay the rest of the arrears or else the government would have to auction the seized sugar to clear the dues before July 31.
S N Balachandra, deputy director, commerce & industries department (sugar), said the payment to farmers would be through banks.

“Deputy Commissioners would be releasing the money in the next three to four days to the bank accounts of farmers. Nearly 5 lakh farmers would have to be paid,” he added.
The officer said that so far the government has seized 8.07 lakh metric tonne of sugar from 29 factories which have failed to make full payment to farmers.

“The government wants to auction the seized sugar. But now there is very low demand as there is glut of sugar in the market. The demand for sugar both in domestic and international market is low. We are not sure how much we may recover by selling it. If the price is around Rs 25 a kg, then we may get about Rs 3,000 to 4,000 crore,” he said.

Balachandra said the government is exploring the possibility of exporting sugar through MSIL. At present the seized stock is lying in the godowns of the mills.
DH News Service