Food Minister, Ram Vilas Paswan on Wednesday said that the Government might provide export subsidy for up to 1.4 million tonnes of raw sugar in the ongoing 2014-15 marketing year (October-September).
"Our department's view is that we should provide subsidy for raw sugar exports and we have circulated the paper in the Cabinet for a meeting," Paswan said at the "Commodity Futures Market Summit" organised by ASSOCHAM.
Shedding some light on the production and the consumption pattern of sugar in India, Paswan said, "Till now our opening stock is about 7.2 million tonnes. Our production target is 25 million tonnes, which might increase, while 24.8 million tonnes is for consumption. So with remaining 0.2 million tonnes, we will have total sugar surplus of about 7.4 million tonnes. Because October-December is slack season, we need to keep sugar stock with us. If we keep about 2 million tonnes for each month then it would come to 6 million tonnes. Therefore, the remaining 1.4 million tonnes can be exported."
To aid the cash-starved industry in clearing sugarcane arrears to farmers, the Centre had announced a subsidy for exports of raw sugar of up to 4 million tonnes last year. The subsidy scheme ended in September 2014.
At first, the Food Minisry had fixed subsidy at Rs3,300 per tonne for February-March, and later it reduced it to Rs2,277 for April-May. The same was reinstated by Food Ministry at Rs3,300 for June- July before hiking it to Rs3,371 for August-September period of last marketing year.
Paswan further said that his ministry would recommend the Finance Ministry to remove the commodity transaction tax (CTT) and to bring a bill on Forwards Contract Regulations Act (FCRA).