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Finance ministry for cut in cane price to Rs 64.50 a quintal
New Delhi, Dec 25: Finance ministry has favoured slashing of statutory minimum cane price (SMP) to Rs 64.5 per quintal arguing that any major hike will result in nothing but bail-out packages.
New Delhi, Dec 25: Finance ministry has favoured slashing of statutory minimum cane price (SMP) to Rs 64.5 per quintal arguing that any major hike will result in nothing but bail-out packages.
In an unprecedented scenario, even as the first quarter of the ongoing sugar season is already over, government is yet to fix the SMP due to inter-ministerial differences, official sources said here.
Even though the food ministry had forwarded the CACP (Commission on Agricultural Costs and Prices) recommendation to hike the cane SMP to Rs 73 a quintal from the present Rs 69.5 a quintal, the former (food ministry) too felt such a major increase was uncalled for at a time when the industry was in a crisis, they said.
On the other hand, agriculture ministry strongly favoured that the CACP recommendation be accepted and the cane price be increased in the interest of the farmers.
Sources said the finance ministry in fact wanted the cane SMP to be cut to last year's pre-drought level of Rs 64.50 a quintal which had been increased mid-season to Rs 69.50 a quintal after the devastating calamity.
The finance ministry's argument was that any disproportionate increase in the SMP would lead to government intervention to bail out the industry, besides leading to lack of competitiveness with their foreign counterparts. Bureau Report
Even though the food ministry had forwarded the CACP (Commission on Agricultural Costs and Prices) recommendation to hike the cane SMP to Rs 73 a quintal from the present Rs 69.5 a quintal, the former (food ministry) too felt such a major increase was uncalled for at a time when the industry was in a crisis, they said.
On the other hand, agriculture ministry strongly favoured that the CACP recommendation be accepted and the cane price be increased in the interest of the farmers.
Sources said the finance ministry in fact wanted the cane SMP to be cut to last year's pre-drought level of Rs 64.50 a quintal which had been increased mid-season to Rs 69.50 a quintal after the devastating calamity.
The finance ministry's argument was that any disproportionate increase in the SMP would lead to government intervention to bail out the industry, besides leading to lack of competitiveness with their foreign counterparts. Bureau Report