ASSISTANCE TO STATES FOR SUGARCANE GROWERS
LOK SABHA
The Uttar Pradesh,
Uttaranchal , Punjab and Haryana Governments have expressed their
unwillingness to avail in its present form, the one time assistance
offered by the Centre to mitigate hardships of sugarcane farmers.
The assistance of Rs.678.06 crore was announced by the Centre
for the sugarcane farmers who have not been paid arrears for the
2002-03 season by private sector sugar factories in Uttar Pradesh,
Uttaranchal, Bihar, Punjab and Haryana.
The Bihar Government
has requested for release of Rs.4954.90 lakh to clear the dues
of sugarcane arrears of farmers. However, this amount includes
arrears of the previous years also. Moreover, the State Government
has not provided the required information regarding the amount
eligible for assistance which is essential for release of funds.
The State Government has been requested to provide the necessary
information so that the funds could be released. Their response
is still awaited.
The State-wise
allocation of funds from the one time assistance is as follows:
|
State
|
Allocation
(Rs.in crores)
|
|
Uttar Pradesh
|
490.21
|
|
Uttaranchal
|
32.25
|
|
Haryana
|
84.73
|
|
Punjab
|
30.96
|
|
Bihar
|
30.96
|
|
Total
|
678.06
|
The assistance
will be in the nature of soft loans to the State Governments at
a concessional rate of interest of 4% with an initial moratorium
of three years and repayable within three years thereafter. The
assistance will be for clearing the sugarcane arrears for the
2002-03 season arising out of the difference between the Statutory
Minimum Price (SMP) and the State Advised Prices (SAP). The outstanding
arrears of sugarcane growers in the country stood at Rs.304689.18
lakh as on 31st March and Rs.233183.80 lakhs as on
31st August, 2003.
The centre has also
decided to offer assistance to the State Governments by way of
market borrowings to help sugar factories clear cane price arrears
for the 2002-03 season. The main features of this assistance are
as follows. (i) The State Governments would be extended financial
support to meet the interest liability to the extent of difference
between the Coupon Rate on the Bonds raised through the additional
market borrowings and 4% the rate at which the loan is being extended
to sugar mills. (ii) The State Governments would, in turn , extend
10 year loans to the sugar mills with a ceiling interest rate
of 4% a year. This loan will have moratorium on repayment of principal
and interest for a period of five years and would, thereafter,
be repaid in five equal instalments. (iii) The assistance would
be available to all sugar mills in non-SA P States and to the
mills in the cooperative and public sectors in the SAP States.
(iv) The extent of open market borrowings would be determined
on the basis of sugarcane price arrears in a given State. (v)
Any additional benefit which a State Government may wish to provide,
would be to the charge of the State Government concerned. (vi)
The State Governments would make specific proposals to the Ministry
of Finance seeking permission for access to additional open market
borrowings.
For the past one
year, the Centre has initiated steps to assist the sugar industry
in improving its viability and thereby facilitating clearance
of sugarcane price arrears. These include creation of buffer stocks
of 20 lakh tons of sugar in December, 2002 for a period of one
year, reimbursement of internal transport charges and neutralization
of ocean freight disadvantage on exports of sugar as also the
handling and marketing charges on account of export of sugar.
This information
was given by the Minister of State for Agriculture, Shri Hukumdeo
Narayan Yadav in a written reply to a question in the Lok Sabha
today.
