Cabinet clears Rs 5.5 per quintal subsidy to sugar mills for clearing dues of farmers

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday cleared the proposal to provide financial assistance of Rs 5.50 per quintal of cane crushed in sugar season 2017-18 to sugar mills to offset the cost of cane. The move is expected to help sugar mills to clear dues of farmers. According to a release, the assistance shall be paid directly to the farmers on behalf of the mills. It will be adjusted against the cane price payable due to the farmers against Fair and Remunerative Price (FRP) policy of the government including that also includes arrears relating to previous years. 

The subsequent balance, if any, shall be credited to the mills' account. Assistance shall be provided to those mills which fulfil the eligibility conditions decided by the government. After the decision, Ravi Kant, Secretary to the Department of Food & Public Distribution in a candid talk with Zee Business's Prakash Priyadrshi said that the subsidy will be transferred into the accounts of eligible mills, which will be decided on the basis of the quantity of cane that was crushed in their plants in the season. However, this amount will be directly paid to the farmers who are attached to them. 

He added sugar mills owe arrears to the tune of nearly Rs 19,000 crore to the farmers. But, the decision has an implication of about Rs 240 crores. This is an immediate assistance to the mills to offset the problems of liquidity. He said the payment will start as soon as the eligibility of the mills is decided.