Export of 2.5 MT expects to improve the domestic sugar market

Pawar asks coop sugar industry to become professional, competitive

Union agriculture minister Sharad Pawar on Saturday asked cooperative sugar industry in Maharashtra to become competitive, professional and innovative in their operations in a bid to survive especially against the rising competition from private sector. Besides, Pawar called upon cooperative units to adhere to austerity measures and focus on increasing the per hectare productivity and production and thereby reduce their reliance on state and central governments. He warned that if they continue to spend recklessly and did not become financially prudent the banks will stop to provide loans which will further become their operations unviable.

 

Pawar was speaking at the 57th annual general meeting of the Federation of Cooperative Sugar Factories in Maharashtra which is a representative body of over 170 cooperative units in the state. Pawar also warned that unless and until they improve their performance he would stop visiting the Federation. He also indicated that the cooperative sugar sector should stop seeking his help in future if they fail to bring in professionalism in their functioning.

 

“Some of the district central cooperative banks have been collapsed due to their heavy exposure to the cooperative sugar sector. This is not a good sign as the state government, which has provided guarantee to a couple of units, will not allow this situation to prevail in future especially when banks also lend to other crops and sectors,” Pawar said.

 

Pawar said that there should minimum export of 2.5 million ton during the current season as it will help the industry to improve the domestic sugar market. His suggestion comes at a time when India's carry forward stock will be 9 million ton and the production during 2013-14 season is expected to be 25 million ton. His logic was that instead of keeping a stock of sugar expecting surge in the price it is better to dispose it of to improve the liquidity.

 

Pawar’s snub to the state cooperative sugar industry comes at a time when most of the units are reeling under heavy financial burden. Maharashtra’s sugar industry contributes 30% to the national output and nearly Rs 4,500 crore towards various taxes to the state and central governments.

 

He said the partial decontrol of the sugar industry in the long term will definitely help the farmers and industry as a whole.  

 

Earlier, Vijaysinh Mohite-Patil, chairman of the Federation of Cooperative Sugar Factories in Maharashtra appealed to Pawar that the Centre should impose 30% import duty instead of the present 15%.  Besides, a transport subsidy be provided from the central and state governments to the industry especially when the sugar prices are falling day by day.