(Image source from: The Indian Express)

The government apprised its determination to fix the ex-factory sugar prices at Rs 29 per kg as well as the monthly stock holding limits on mills as to aid cash-starved industry to clear cane arrears which have crossed Rs 22,000 crore.

The Cabinet Committee on Economic Affairs (CCEA) has sanctioned these decisions yesterday.

The ministry of food notified the Sugar Price (Control) Order, 2018 to empower itself to fix the minimum selling price of the sweetener.

The Centre will take into consideration the Fair and Remunerative Price (FRP) of sugarcane, conversion cost to produce sugar and realization of profit from bye-products while fixing the price.

This bid empowers the government in factories and seizure of stocks to inspect records, enter and conduct searches.

A separate presentment was issued to fix Rs 29 per kg as the present selling price.

"No producer of sugar shall sell or agree to see or otherwise dispose of or deliver or agree to deliver white or refined sugar in the domestic market or remove white or refined sugar from the godowns of the factory in which it is produced for sale in the domestic market at a rate below Rs 29 per kg till further orders," the notification said.

Directing the quantity of white or refined sugar stock the ministry issued an order that every manufacturer of sugar shall hold at the end of June 2018.

Yesterday, the ministry declared Rs 8,500 crore package to boost farmers income by creating buffer stock for sugar, intensifying ethanol production capacity and fixing a minimum price for selling to cut mill losses.

Rs 4,440 crore soft loan for building ethanol production capacity to absorb buffer and cane stock of 3 million tonnes had sanctioned by the cabinet that is headed by Prime Minister Narendra Modi, besides for the initial time fixing Rs 29 per kg as the minimal price beneath which mills cannot sell sweetener.

By Sowmya Sangam