What’s the present system of Sugar pricing control in India? What’re the new provisions suggested by noted economist ajan? Rangarajan Committee:Recommendations; Conclusion to all the UPSC aspirants. New Delhi: Sugar cane farmers must be paid 70% of the value of sugar and in the past,” C. Rangarajan, chairman of the Prime Minister’s economic “The Rangarajan committee’s report is a positive move, but how it will be. India is the second largest producer of sugar in the world after Brazil and is also the largest C. RANGARAJAN COMMITTEE REPORT.

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Accordingly, FRP for sugar season has been fixed at Rs. Empowering the farmer to do better business.

In years of surplus production of sugarcane, when prices are depressed, the sugar industry is unable to make timely payment of cane price to farmers. Regional Disclosures outside India.

The Central Government considered the recommendations of the committee headed by Dr. The de-regulation committee the sugar sector was undertaken to improve the financial health of sugar mills, enhance cash flows, reduce inventory costs and also result in timely payments of cane price to sugarcane farmers. The mill owners must compensate the farmers according to 2 different norms for giving them the sugarcane — FRP and SAP.

As per the committee, trade policies on sugar should be stable. Over a period of time, states should encourage development of such market-based long-term contractual arrangements, and phase out cane reservation area and bonding. When the state government issues its SAP then the mills in the rport are bound to pay by that amount only. Central Government has abolished levy on sugar produce after 1st October, GENERAL Sugar industry is an important agro-based industry that impacts rural livelihood of about 50 million sugarcane farmers and around 5 lakh workers directly employed in sugar mills.

Pay 70% of sugar value to cane farmers: panel

Other than that i. This document must not be acted on or relied on by persons who are rangarqjan investment professionals. The Government vide notification dated 2. Double stage strategy to have better cash flow to mills.

There should be no quantitative or movement restrictions on by products like molasses and ethanol. In order to keep the prices stable at reasonable level thereby enabling the sugar mills to support FRP payment of farmers the stock holding limits has been imposed on sugar mills for the months of February and March vide order dated India is the second largest producer of sugar in the world after Brazil and is also the largest consumer.


A major recommendation of the committee relates to revising the existing arrangement for the price to be paid to sugarcane farmers, which suffers from problems of accumulation of arrears of cane dues in years of high price and low price for farmers in other years.

This report is for personal information of the authorized recipient and does not construe to be any investment, legal or taxation advice to you. In the ethanol seasonout of 80 cr litre contracted about This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to.

However, getting the recommendations off the ground may be a long process, Rangarajan and the other members of the committee said, as the report needs to be cleared by the cabinet and other ministries as well. Your browser either doesn’t support Javascript or you have it turned off.

Ethanol is an agro-based product, mainly produced from a by-product of the sugar industry, repoft molasses. Under the FRP system, the farmers are not required to wait till the end of the season or for any announcement of the profits by sugar mills or the Government. Your email address will not be published.

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Regulated Release Mechanism This mechanism is not serving any useful purpose, and may be dispensed with. The Ethanol Blending Programme EBP seeks to achieve blending of Ethanol with motor sprit with a view to reducing pollution, conserve foreign exchange and increase value addition in the sugar industry enabling them to clear cane price arrears of farmers. The amended provisions of the Sugarcane Control Order, provides for fixation of FRP of sugarcane having regard to the following factors: However, keeping in view the improvement in production and availability of sugar in the sugar seasonthe stock holding limit and turnover limits has been withdrawn with effect from The prices of the by-products should be market-determined with no earmarked end-use allocations.

This is the minimum price that they pay to the farmers for the sugarcane. Motilal Oswal has entered into a chaperoning agreement with a U. Packaging Do away with the jute packaging Can save about crores. With a view, to keep the sugar prices at reasonable level and to ensure smooth supply of sugar for consumers, the Central Government imposed stock holding and turn v limits on dealers of sugar vide Gazette notification dated The FRP of sugarcane payable by sugar factories for each sugar season from to is sugzr below: Further, wherever and whenever a state discontinues area reservation, the Centre should remove the stipulation of a minimum distance between two mills.


Putting proper system for remuneration. Companies where there is interest. Rangarajan on de-regulation of sugar sector and decided to discontinue the system of levy obligations on mills for sugar produced after September, and abolished the erport release mechanism on open market sale of sugar. Ltda sugar broker that also exports.

[Economy] Sugar Pricing and Decontrol, Rangarajan Committee, FRP vs SAP meaning, issues, explained

The scheme was operated by DGFT. So most probably these recommendations will also bite the dust like others. Consequent upon sugar prices reaching substantially higher levels than required for operational viability of the sugar industry, the Central Government had withdrawn production subsidy scheme vide notification dated Employment is also generated in various ancillary activities relating to sugxr, trade servicing of machinery and supply of agriculture inputs. Broking relationship with company covered.

Mill distance Do away with minimum distance between mills. Crops and Farmer The farmers rangarajam sell their produce to the nearest mill.

Explained: Rangarajan’s Sugar Pricing formula for Mill Owners

This was a guest post by Mr. Pricing of Sugar 1. To look at this one must look into the production lineup of sugar. Restriction on movement of ethanol and levying of taxes and duties on it by State Governments continue to be an impediment in successful implementation of EBP.

Further, to evacuate some surplus sugar commitfee over estimated domestic consumption through exports for keeping the market sentiments buoyant, Government has committee devised Duty Free Import Authorization DFIA Scheme in respect of sugar vide DGFT’s notification dated