A sweet revenge

 

 

That was indeed a historical day in an agrarian movement. The collective voice of thousands of sugarcane farmers was so strong that the Centre finally had to capitulate. In many ways, it evoked the memory of 1988 when a large multitude of farmers had gathered at the Boat Club to make their voice heard. Although the latest movement lacked the similar impetus, none the less, it was enough to stir the capital. In fact, managing the November 19 rally became an uphill task for Delhi Police too, as the city came to a grinding halt and witnessed massive traffic jams. And irrespective of what Delhites thought about them, farmers kept trampling whatever came in their way. It appeared as if Delhi for them was a mere manifestation of power-brokers that they so despise. Trampling Delhi was like trampling these lawmakers.

The rally of these wronged-against farmers had a momentum of its own. In a way, it was not instigated unlike generally held political rallies. In fact, the cadres of the Rashtriya Lok Dal (RLD) were busy arranging for vehicles to ferry farmers to Jantar Mantar. It came as a pleasant surprise to them that the farmers had already arranged their conveyance and that too with their own money. Clearly, for once, a movement was not fabricated from the beginning.

It was therefore not surprising that sugarcane farmers from western Uttar Pradesh had gathered at Jantar Mantar cut across all social and political lines. Farmers, waving sticks of cane, outnumbered those who were waving flags of a particular political party. Farmers were peeved over the new ordinance by the Central government that advocated setting the Fair and Remunerative Price (FRP) of cane for the agriculture year 2009-10 at Rs 129.85 per quintal. This essentially means that if the respective state governments fix the price of procurement that is higher than the above quoted band, then the margin amount will have to be borne by the state government and not the sugar mill owners. Clearly, it appeared as a respite for the owners.

However, the burgeoning farmers' movement and the univocal support by the Opposition parties made the government sit up and listen. Subsequently, the UPA regime and, more importantly, its agriculture minister Sharad Pawar had to reverse the decision. The government will bring in amendment in the current ordinance that will ensure that if the state government fixes the State Advisory Price (SAP) higher than the FRP, the margin will have to be borne by the mill owners.

However, farmers from western Uttar Pradesh still feel cheated. Referred at times as the “Sugar bowl of India”, Uttar Pradesh is the largest producer of sugar in the country. However, the farmers in the state get far less a price for the cane than their counterparts in other states in India. In adjoining Haryana and Punjab, the MSP for per quintal cane is around Rs 210. The corresponding price in UP is merely Rs 145. In Maharashtra, farmers are paid in a band of Rs 260-270 whereas in Gujarat, it is slightly lower at Rs 210-230. In Maharashtra, sugar mills also sell out dividends to the farmers. However, the per hectare production of sugar in UP is the lowest among the major cane-producing states.

The state government has raised the SAP to Rs 165-170 this year. And following the agitation by the farmers, the UP chief minister Mayawati has also announced an additional Rs 15 per quintal as a bonus. However, farmers are not going to agree upon anything below Rs 280 per quintal. Meanwhile, the national spokesperson of Bhartiya Kisan Union (BKU), Rakesh Tikait, says, “When sugar was being sold at Rs 20 per kg, we were getting Rs 140 per quintal for the cane. Now it is selling at Rs 40 per kg, the logical and proportional price for us is Rs 280. We are not happy with the price announced by the owners. Given that Uttrakhand government has announced the price band at Rs 220, it will not be economically viable to settle at anything below that.”

Fed up with the government’s apathy, farmers are shifting to the other crops. In fact, in the last two years, the sown area for sugarcane in UP has decreased by 20 per cent whereas the corresponding figure in Punjab-Haryana agricultural belt is about 40 per cent. Naturally, it is not a good omen for the world’s largest producer of sugar. In the year 2007-2008, the country produced 264 lakh metric tons of sugar. The figure has gone down to 150 lakh metric tons this year; whereas the actual demand in domestic market is 220 lakh metric tons. If the apathy continues, the production will go further down.

The situation is rather deteriorating fast. Aggrieved farmers are burning canes in the fields themselves. This year, out of 99-odd sugar mills in the state, only about a dozen mills have started operations. Mill owners also hackle on fixed prices. Not only that, they also don’t pay on time. In UP alone, several mills still have to dispense payments worth crores. On the other hand, these mill owners earn huge margins on the finished goods. The balance sheets of these firms and their performance at various stock exchanges prove this.

Actually it is not only sugar that brings them the profit but other by-products as well. National convener of Rashtriya Kisan Majdoor Sangathan V. M. Singh says, “Mill owners make a fortune by exploiting poor farmers. There are other sources of income as well. In fact, sugar forms merely 50-60 per cent of the total profit. Other products and carbon credits also bring in cash.”

However, this current agitation has rattled the otherwise stubborn mill owners as well. Samir S. Somaya, president of Indian Sugar Mills Association, says, “Farmers should get the right price for the cane. But any price should be settled upon only when both sides agree on it.” CM Mayawati too is wary of the farmer’s mood. She has asked her officials to carve out a plan for the ongoing crisis by involving the farmers. Normally, cane crushing begins by October 1 every year, but this time it is already late due to the problem. Both farmers and mill owners are suffering losses. Late crop will ensure less sugar production per quintal of cane, which means lesser price for the farmers. Mill owners will also get less for that kind of sugar. (Inputs from Vikas Kumar, Delhi and Avinash Mishra, Lucknow) “UPA government as a whole is serving the cause of the mill owners”

Ajit Singh
National President, RLD

Are you happy with the decision to amend the ordinance?

The Central government has saved sugarcane farmers from penury and hunger by agreeing to our demands. Under the pressure of mill owners, the UPA government is willing to do away with SAP. In reality, end of SAP will essentially mean end of sugarcane farmers.

You mean Sharad Pawar is serving the cause of mill owners…

Any ordinance or bill is brought only after the Prime Minister and the Cabinet agree to it. Therefore, I will prefer to say that the UPA government as a whole is serving the cause of the mill owners.

What according to you should be the price band and what should be the mechanism?

The price will be set by the farmers themselves. The state government should discuss it with the farmers and agree upon a price. The cost of the production has gone up in the last few years. In the absence of adequate electricity, irrigation is being carried out by using diesel pumping-sets. Drought and flood have further aggravated the problem.

Mill owners maintain that there are too many government regulations and controls on them and they don’t earn enough to meet the farmers' demands.

It is common knowledge that mill owners earn huge profits through sale of by-products too. Their balance-sheets speak volumes about that. If they claim that they are not earning profits, why are they opening new mills every year?