Sugarcane SMP raised to Rs 73

In a move aimed at winning over farmers before the Lok Sabha polls, Prime Minister Atal Bihari Vajpayee has cleared a proposal for fixing the statutory minimum price (SMP) for sugarcane at Rs 73 a quintal.

The decision to enhance the SMP to Rs 73 from Rs 69.5 a quintal is seen as a definite signal that the government is preparing for early Lok Sabha polls. The move is aimed at addressing a huge constituency of sugarcane growers, who are sulking over the non-payment of their arrears by sugar mill owners , particularly in Uttar Pradesh and Bihar.

Vajpayee personally intervened to clear the proposal, even though initially there was strong resistance from Finance Minister Jaswant Singh and Food Minister Sharad Yadav. At a meeting chaired by Vajpayee and attended by Jaswant Singh, Sharad Yadav and Agriculture Minister Rajnath Singh today at the Prime Minister's Race Course Road residence, Vajpayee appeared to have given a final approval to the proposal.

Sources in the government admitted that the decision was indicative of poll preparations.

Though the agriculture ministry had recommended a SMP of Rs 73 a quintal, the Cabinet successively deferred a final decision on the issue. Recently, the Cabinet had authorised Vajpayee to take a final decision.

In earlier meetings also, Yadav had opposed the proposal of enhancement of the SMP on the plea that it would be difficult for sugar mill owners to sustain financially after such a steep hike in the SMP.