With the deadline for clearing sugarcane dues set by Uttar Pradesh Chief Minister Adityanath having passed, sugar mill owners in the state face the prospect of FIRs being registered against them.
In Bijnor, where pending sugarcane dues are around Rs 500 crore, the district administration has issued notices to sugar mills in the district, warning them that if the dues are not cleared within seven days, the administration will lodge FIRs against mill owners and senior management officials.
According to UP Cane Commissioner, the pending sugarcane dues for the 2018-19 crushing season stands at Rs 6,323 crore as on September 6. This is almost a week beyond the deadline of August 31 set by the Chief Minister for sugar mills to clear the cane arrears.
Farmers in various parts of western Uttar Pradesh, where sugarcane is the primary crop, have been protesting. In Meerut, farmers protested at the office of the deputy cane commissioner, leading to a skirmish with the police.
Muzaffarnagar and Saharanpur too have seen farmers take to the streets to demand payment of their pending arrears and an agitation continues in Bijnor.
As per the provisions of the UP Sugarcane (Regulation of Supply and Purchase) Act, 1953, sugarcane arrears ought to be cleared by sugar mills within 14 days of taking delivery of cane. If the payment is delayed, sugar mills are required to pay an interest of 15 per cent per annum for the period of the delay in addition to the principal amount.
However, none of these rules are followed or enforced in UP. Farmers are very rarely paid the price of their cane within 14 days as the law requires and sugar mills never pay any interest to the farmers for the delay.
Before the Assembly elections in Uttar Pradesh in 2017, Prime Minister Narendra Modi had promised that if the Bharatiya Janata Party was voted to power it would ensure that sugarcane arrears were cleared within 14 days. The Prime Minister had said: “Farmers do the hard work and everybody is growing at the cost of farmers and my government in UP will clear arrears within 14 days.”
That, however, has proven to be easier said than done. The BJP in Uttar Pradesh has failed to ensure timely payment of sugarcane arrears in both the seasons that it has been in power. It has also failed to enforce the rule that requires sugar mills to pay interest to farmers in case of delay in payment.
The Centre recently announced a Rs 6,000-crore export subsidy to sugar mills to help clear sugarcane dues across the country. The payment, the Centre said, would be made directly to the farmers. It remains to be seen how successful this move will be as the sugar prices in the global market remain below the cost of production.
The Union Cabinet on August 28 had announced an export subsidy of over Rs 10,000 per metric ton to sugar mills to help clear the pending arrears of sugarcane farmers for the 2019-20 season. The amount will be credited directly into the accounts of farmers on behalf of mills against the dues owed to farmers, the government said.