UP panel to look into sugar mill losses

The newly elected Uttar Pradesh Sugarcane Development Minister Naseemuddin Siddiqui on Thursday formed a six-member committee to look into the problems faced by the sugar industry in the state.

A delegation of the Uttar Pradesh Sugar Mills' Association (UPSMA), led by its chairman C B Patodia met Siddiqui and other officials of the UP sugarcane department on Thursday to apprise the latter of the problems being faced by the industry.

UP is the largest sugar producer and had produced 84 lakh tonnes sugar so far in the 2006-07 (October-September) season. "We told the minister that higher sugarcane prices in the state is the primary reason behind mills' losses and the huge arrears to farmers", said Patodia.

The committee will submit its report in 10 days, after which the government is expected to take a decision. The committee will take into consideration the cost of sugar production, its selling price and subsidies offered by states such as Maharashtra while preparing the report.

"We have demanded a subsidy amounting to Rs 40 per quintal of cane crushed in the 2006-07 season. If accepted, this would cost the state exchequer about Rs 3,000 crore and the money will help us in clearing cane arrears that must be about Rs 2,000 crore," he said.