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Maharashtra Government Approves Payment of FRP for Cane in Two Installments

The state government approved a decision on Monday allowing mills to pay the basic FRP in two instalments, among other things.

Chintu Das
Maharashtra CM, Uddhav Thackeray
Maharashtra CM, Uddhav Thackeray

Farmers have objected to the state government's decision to enable the payment of the Fair and Remunerative Price (FRP) for cane purchased from farmers in two instalments. Growers believe that the measure will force cane farmers into penury. 

The state government approved a decision on Monday allowing mills to pay the basic FRP in two instalments, among other things. The state government has announced a mechanism in which the initial payment would be the region's basic FRP based on average sugar recovery, with the final recovery and payment computed within 15 days of the season's conclusion. The profits from the sale of sugar and ethanol produced from diverse sources, such as cane juice, B heavy, or C molasses, will be factored into the final computation. 

To make the payment process more efficient, the state has been separated into two recovery zones: the revenue divisions of Pune and Nashik, which have an average recovery of 10%, and the remainder of the state, which has an average recovery of 9.5 percent. 

The resolution passed on Monday overturns the current system of sugar mills declaring and paying farmers based on their previous year's sugar recovery. Mills will pay farmers at the rate of recovery from the 2020-21 sugar cane crushing season for the 2021-22 season. Mills will be given some breathing room to pay their dues under the ruling, which will take effect in the 2022-23 season. 

Farmers, on the other hand, contend that the order is in their best interests. Farmers in Sangli and Kolhapur, who have benefited from greater payments than the rest of Maharashtra due to high sugar recovery, will be paid at the same rate as farmers in Ahmednagar, where recovery is lower. 

The average FRP (excluding harvesting and shipping expenses of Rs 500 per tonne) for Sangli and Kolhapur, where the average recovery is 12.50 percent, is in the region of Rs 2,800 per tonne, whereas Ahmednagar is significantly lower at Rs 2,100-2,200 per tonne. 

The initial instalment for the remainder of the state will be Rs 2,000-2,100 per tonne. After the season is through, the final FRP will be determined, and farmers will get their final payout. 

Raju Shetti, a former MP, has 'challenged' the state government and the mills to carry out this order. Shetti, whose Hatkanagale parliamentary seat includes the sugar bowls of Sangli and Kolhapur, challenged the mills to begin operations with this arrangement. "This is robbery in broad daylight, and we will never accept it," he stated. 

Farmers like Ankush Chormule of Ashta village in Sangli district's Walva taluka called the order absurd. Chormule has nine acres of cane fields and mills in his neighbourhood, including one run by NCP leader and state minister Jayant Patil. Chormule's basic FRP, which is to be paid in one go, is in the region of Rs 2,850-2,900 per tonne, based on the average recovery of the mills to whom he provides cane. "As a result of this order, my first payment would be Rs 2,100 per tonne." What guarantee do you have that mills will declare the correct recovery and pay us at the end of the season?" he said. 

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