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System of payment of sugarcane prices based on SAP should be kept intact

Considering the larger interests of cane farmers, the Uttar Pradesh Chief Minister Ms. Mayawati has requested the Prime Minister Dr. Manmohan Singh to reconsider the arrangement of payment of difference between the fair and remunerative prices (FRP) and state advisory price (SAP) by the state government. She requested that the current system of the payment of sugar cane prices based on SAP should be kept intact.
In her letter written to the Prime Minister today, the Chief Minister said that the state’s right to fix SAP was recognised by the decision of the Hon’ble Supreme Court. The Government of India did not take the state government into confidence before making all the amendments/arrangements related to FRP. Thus, the interests of about 40 lakh cane growers of U.P. were completely ignored, she pointed out.
Ms. Mayawati said that the Government of India on the one hand increased the support prices of crops life wheat; paddy etc. continuously during the last few years, while on the other the statutory minimum price (SMP) registered minimum increase comparatively. Owing to crop prices policy of recent years, the area of sugar cane and its production and sugar production decreased continuously. She said that the FRP announced by the Government of India for the current crushing season had enraged and moved the farmers considerably. The Chief Minister said that the Government of India by amending the Essential Commodities Act and Sugar Cane Control Order 1966 for fixing remunerative prices of sugar cane had indirectly ended the rights of the state government for fixing SAP. She said that according to this new amendment if a state government fixes SAP in the excess of FRP then the same would have to bear the payment of the difference. Since, the sugar mills directly purchase sugar cane from the cane cooperative societies/cane growers; therefore, the same was sold/purchased on the mutual consent based on SAP announced by the state government. She said that in this perspective there was no question of bearing the difference between the FRP and SAP by the state government.
Ms. Mayawati said that for the crushing season 2009-10, the Government of India had fixed FRP at Rs. 129.86 paise per quintal on the basis of 9.5 per cent of recovery. Till the crushing season 2008-09 the SMP was based on 9 per cent recovery. Thus, on the basis of 9 per cent recovery, the FRP for 2009-10 was estimated at Rs. 123 per quintal only, while the state government had announced SAP for general category sugar cane at Rs. 165 per quintal and for sugar cane of agaiti prajati it was fixed at Rs. 170 per quintal. The Chief Minister also informed the Prime Minister that the state government had been fixing SAP since the crushing season 1973-74 for ensuring remunerative prices to the cane growers of the state. She said that the SMP of the sugar cane was fixed by the Government of India keeping in view the prices of levy sugar and its quota from this year had been fixed at 20 per cent. The Government of India got sugar on the levy prices from the sugar mills for distributing sugar through the PDS so that the weaker sections of the society got sugar at cheaper rates. She said that denial of remunerative prices to the cane growers for getting sugar from limited levy quota was not correct.

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