Explanation:

It is the price declared by the government, which mills are legally bound to pay to farmers for the cane procured from them.

• The payment of FRP across the country is governed by the Sugarcane Control order, 1966 which mandates payment within 14 days of the date of delivery of the cane.

• Mills have the option of signing an agreement with farmers, which would allow them to pay the FRP in installments.

• Delays in payment can attract an interest up to 15 per cent per annum, and the sugar commissioner can recover unpaid FRP as dues in revenue recovery by attaching properties of the mills.

• The FRP is fixed by the Union government (Cabinet Committee on Economic Affairs (CCEA)) on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP).

The amended provisions of the Sugarcane (Control) Order, 1966 provides for fixation of FRP of sugarcane having regard to the following factors:-

• cost of production of sugarcane

• return to the growers from alternative crops and the general trend of prices of agricultural commodities

• availability of sugar to consumers at a fair price

• price at which sugar produced from sugarcane is sold by sugar producers;

• recovery of sugar from sugarcane;

• the realization made from sale of by-products viz. molasses, bagasse and press mud or their imputed value

• reasonable margins for the growers of sugarcane on account of risk and profits.

Hence both statements are correct.