Govt rules out creation of sugar buffer stock

Govt rules out creation of sugar buffer stock

The Centre said on Monday that it had not considered former agriculture minister Sharad Pawar’s demand for creation of a buffer stock of two million tonnes of sugar to bail out the cash-strapped industry.

“Sugar prices are depressed. Creation of buffer stock would lead to increase in retail prices of sugar by Rs 3 to Rs 4,” Food and Consumer Affairs Minister Ramvilas Paswan told reporters here. “This is not a permanent solution. Hence, we are not considering it,” Paswan said while addressing a press conference to highlight achievement of his ministry.

The industry has been demanding that the government create a buffer stock of sugar by buying excess stocks in the market. Arrears due to farmers and payable by the sugar millers have crossed Rs 21,000 crore. Paswan made it clear that the Centre does not have much role to play in this matter besides fixing the fair and remunerative price of sugarcane.

“If millers do not pay to farmers then states have powers to take action against them,” he said.

To improve the finances of cash-starved millers, the minister said the Centre has already taken many measures including hike in sugar import duty to 40 per cent, subsidy of Rs 4,000 per tonne for export of 1.4 million tonnes of raw sugar and promotion of ethanol blending. Pawar had written to Prime Minister Narendra Modi putting his weight behind the industry for creating a buffer stock. India’s sugar production is estimated to touch 28 million tonnes in 2014-15 marketing year (October-September), as against 24.3 million tonnes in the previous year.

The total annual demand is pegged at 24.5 million tonnes, while exports are projected at 0.7 million tonnes. This means, the country would have an opening stock of 10.3 million tonnes of sweetener when mills start new marketing year in October.
DH News Service

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