New Delhi: To keep the industry in sound financial health, a Niti Aayog task force has recommended linking sugarcane prices to sugar rates.
It has also pitched for a one-time increase in minimum sugar price to Rs 33 per kilo to help sugar mills cover the cost of production.
The report of the panel on ‘Sugarcane and Sugar Industry’, headed by Niti Aayog Member (Agriculture) Ramesh Chand, was posted on the government think-tank’s website recently.
The task force also recommended shifting of some areas under sugarcane cultivation to less water-intensive crops by providing suitable incentive to farmers.
“The task force feels that to prevent the problem of arrears for sugarcane farmers and to keep the sugar industry in sound financial health, sugarcane prices must be linked to sugar prices.”
The report added: “The Revenue Sharing Formula (RSF) needs to be introduced, with a Price Stabilisation Fund to protect farmers from receiving prices below the Fair and Remunerative Price (FRP). While the scientific formula suggested by the Rangarajan Committee could be considered, the prices of sugarcane may need to be adjusted slightly upwards keeping in view the improvement in recovery rates in the last few years.”