Janjivan Bureau / New Delhi : The Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi has approved the creation of buffer stock of 40 lakh metric tonnes (LMT) of sugar for one year and to incur estimated maximum expenditure of Rs.1674 crores for this purpose. However, based on the market price and availability of sugar, this may be reviewed by the Deptt. of Food and Public Distribution any time for withdrawal.
India had a buffer stock of 3 million tonnes of sugar in the current year.
The world’s second biggest sugar producer will spend 16.74 billion rupees ($242.68 million) on buffer stocks in the year starting Aug. 1, it said.
The reimbursement under the scheme would be met on quarterly basis to sugar mills which would be directly credited into farmers’ account on behalf of mills against cane price dues and subsequent balance, if any, would be credited to the mill’s account.
Years of bumper cane harvests and record sugar production have hammered sugar prices in India, making it hard for mills to pay money owed to farmers, who form an influential voting bloc.
India also decided to keep minimum cane buying price steady at 275 rupees per 100 kg for the next marketing season starting from Oct. 1, the government said.
The south Asian country is expected to start the new season with inventory of more than 14.7 million tonnes and could produce another 28.2 million tonnes in the season, against local demand of around 26 million tonnes, the Indian Sugar Mills Association (ISMA) estimates.
