Ghaziabad: Alok Kumar, Vice-President of the libertarian Swarna Bharat Party (SBP), has said that sugarcane farmers are being looted by governments through corrupt ministers and crony capitalists in the false pretext of protecting the farmers. Governments have choked the market and are using these laws to strangle the livelihood of 60 million farmers.
Socialist laws control both the movement and prices of sugarcane and associated by-products, according to the SBP. The central government sets what is claimed to be a “fair and remunerative price” for sugarcane. State governments set a “state-advised price”. But these prices are far from fair, says the SBP. The party asserts that these prices are far lower than the market price.
State governments also fix quotas for end-uses for molasses and impose restrictions on trade across state borders on molasses and bagasse. Farmers are, the SBP says, thus forced to sell their produce at throwaway prices.
Kumar gave the example of molasses, a major sugarcane by-product. Molasses form a key input to alcohol production. The market price of molasses is around Rs 7,000 per tonne but the Uttar Pradesh government pays mills no more than Rs 2,000 per tonne. The remaining value (which is in the hundreds of crores) is shared between corrupt ministers and liquor licence holders.
[stextbox id=”alert” caption=”SBP adds”]The SBP does not want any price “management” by the government. These distort price signals and allocation of resources. We have made clear in our press release on agriculture, here.
One may refer to the article in Business Standard for the pricing on molasses. It gives the pricing of molasses in one of the illustrations: “The open market price of molasses is around Rs 6,000 a tonne, whereas the liquor manufacturers pay only Rs 750 a tonne.” The price is paid only to mills, as per the UP Sheera Niyantran Adhiniyam 1964.
The SBP has explored the facts on the ground by discussing with the senior officials of a number of sugar mills. We believe that because of the compulsion of the law, the market price is not paid to farmers for the molasses component of sugarcane produce. A free market would not have this arbitrary restriction in cane pricing. The astronomical profits earned from liquor out of molasses are not shared with mills or farmers.
Moreover, government delays making even these low payments, which leads to further losses for producers. As per the Sugarcane (Control) Order, 1966, farmers must be paid 15% interest on any payments delayed beyond 14 days. However, farmers’ payments are always in arrears and they never get the promised interest. The law says that mills that delay payments to farmers cannot charge transportation fees for carrying sugarcane from collection centres to the mills. However, this law is never followed.
Kumar asked, “What business does government have to interfere in the open market? Why should farmers not have freedom to sell their produce at the best price they can get?” He said that these scandalous anti-people laws must go. India must have a free market in agriculture. SBP wants the free movement of sugarcane and its by-products across India and the abandonment of all end-use quotas.
Liberating the sugarcane industry will allow mills to get a much higher price for sugar and molasses. Farmers will benefit enormously from these higher prices. Further, mills will receive money in a timely manner from the market and will be able to pay the farmers immediately.
Through a press release, the SBP has said that it wants the whole of India to be free. It wants to release India from the grip of socialists who have destroyed India. SBP is committed to destroying the cronyist system operating in India, it claims.