Bengaluru: The state government has asked the Union government for fiscal assistance to the tune of Rs 1800 crore, rather than a soft loan to owners of sugar factories, to help clear arrears of Rs 2400 crores due to sugarcane farmers.
Union minister for food and civil supplies Ram Vilas Paswan, however, told the state government to approach Union finance minister Arun Jaitley, along with other sugarcane growing states like Maharashtra and Uttar Pradesh after Chief Minister Siddaramaiah raised the issue of payment of dues to sugarcane farmers at a meeting here on Thursday.
At the meeting, Mr Paswan said his ministry could only recommend the FRP for sugarcane farmers but not implement it. When he mentioned about the soft loan of Rs 6000 crore extended to the sugar industry in order to make payments to farmers, Mr Siddaramaiah remarked that the state’s share was only Rs 900 crore. The state would require Rs 1800 crore to bridge the gap between cost of production of sugar and FRP and therefore the Union government should step in with financial assistance, the CM added.
Speaking to the media after the meeting, Mr Paswan said the Union government has addressed problems of the sugar industry, including its four demands such as enhancing sugar import duty from 15% to 40%, increase in export incentives from Rs 3300 to Rs 4000 per quintal, and a hike in ethanol mix for fuel from two per cent to ten per cent.
The meeting also deliberated on shortage of warehouses in Karnataka to store food grains. “I have said that the Centre would enhance the capacity of warehouses by constructing some new ones,” Mr Paswan added.
