Centre bails out cash-strapped sugar sector

 Stepping into the aid of farmers, the Centre on Wednesday approved interest-free loans to the tune of Rs 6,000 crore to help the sugar mills clear the arrears of cane growers which have spiraled to Rs 21,000 crore.

In a bid to encourage sugar mills to produce ethanol instead of the sweetener, the Modi government also increased the price of the fuel blender from Rs 32 per litre to Rs 42 per litre.

The Cabinet Committee on Economic Affairs(CCEA), at a meeting chaired by Prime Minister, decided that the arrears of the farmers will be paid directly in the Jan Dhan bank accounts to ensure that the funds are not diverted by the millers elsewhere.

“We will seek a list of farmers to whom arrears have to be paid from the sugar mills. The money will be transferred into the Jan Dhan bank accounts,” Union Minister Nitin Gadkari told reporters at a briefing on the Cabinet decisions.

Sugar mills in Uttar Pradesh owe Rs 10,000 crore to cane growers, followed by Maharashtra (Rs 3,700 crore) and Karnataka (Rs 1,800 crore).
DH News Service

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