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ndia, the world's second largest producer of sugar, has been hit by a shortage. And with the crisis, have come the allegations of a scam. At the crux of it is the governemnt's sugar policy, which allowed mill owners to export till last year, but not enough was done to help farmers deal with a bumper crop.
Brinda Karat, member of the CPM Politburo, says: ''The government allowed exports till December. Then in a bizarre turn of events, it allowed import of raw sugar in January.''
There are leads to the present crisis to be found in old files, documents that are now with NDTV. They show that:
* In 2007-2008 India recorded a bumper harvest
* The Centre's Minimum Support Price was at Rs 81. This is the minimum price at which famers sold each quintal of sugarcane. The only exception was Uttar Pradesh. The biggest sugar producing state was going to polls and the BSP government fixed the support price at Rs 140.
* Farmers had no means of holding on to the bumper crop and were pushed into distress sales or worse - burning their crops. JP Patil, a farmer from Nanded says: ''When we had a bumper crop last year, we were forced to burn it down.''
* That year India produced 27 million tonnes of sugar. The domestic market needs just 22 tonnes.
* The glut pushed prices down by about 30%A
* Prices were down from Rs. 18 to Rs 13
As an excess of 5 million tonnes piled up, the government allowed sugar mills to export in the international market, where prices were rising. The prices were rising because the biggest producer, Brazil, had cut down exports.
Thus, where the farmers lost money, sugar mill owners made a killing. Disillusioned, many farmers turned to other crops this year, resulting in a shortage of sugarcane.
Professor Sudhir Banwar of Lucknow University says: ''The decision to export helped only the mill owners. This created a lot disincentive as a result of which the sugarcane farmers switched to other crops this year.''
As farmers moved away, sugarcane this year has seen a 30% drop in cultivation.
A vicious circle that has left the country less sweet.
Now that the government has swallowed a bitter pill, it is taking a hard look at its sugar policy. Also with big producers like Maharashtra going to polls, the government can ill-afford to ignore the farmers' concerns.
ndia, the world's second largest producer of sugar, has been hit by a shortage. And with the crisis, have come the allegations of a scam. At the crux of it is the governemnt's sugar policy, which allowed mill owners to export till last year, but not enough was done to help farmers deal with a bumper crop.
Brinda Karat, member of the CPM Politburo, says: ''The government allowed exports till December. Then in a bizarre turn of events, it allowed import of raw sugar in January.''
There are leads to the present crisis to be found in old files, documents that are now with NDTV. They show that:
* In 2007-2008 India recorded a bumper harvest
* The Centre's Minimum Support Price was at Rs 81. This is the minimum price at which famers sold each quintal of sugarcane. The only exception was Uttar Pradesh. The biggest sugar producing state was going to polls and the BSP government fixed the support price at Rs 140.
* Farmers had no means of holding on to the bumper crop and were pushed into distress sales or worse - burning their crops. JP Patil, a farmer from Nanded says: ''When we had a bumper crop last year, we were forced to burn it down.''
* That year India produced 27 million tonnes of sugar. The domestic market needs just 22 tonnes.
* The glut pushed prices down by about 30%A
* Prices were down from Rs. 18 to Rs 13
As an excess of 5 million tonnes piled up, the government allowed sugar mills to export in the international market, where prices were rising. The prices were rising because the biggest producer, Brazil, had cut down exports.
Thus, where the farmers lost money, sugar mill owners made a killing. Disillusioned, many farmers turned to other crops this year, resulting in a shortage of sugarcane.
Professor Sudhir Banwar of Lucknow University says: ''The decision to export helped only the mill owners. This created a lot disincentive as a result of which the sugarcane farmers switched to other crops this year.''
As farmers moved away, sugarcane this year has seen a 30% drop in cultivation.
A vicious circle that has left the country less sweet.
Now that the government has swallowed a bitter pill, it is taking a hard look at its sugar policy. Also with big producers like Maharashtra going to polls, the government can ill-afford to ignore the farmers' concerns.
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