Punjab to recover Rs 223.75 cr from 7 private sugar mills

The Punjab Government today decided to recover Rs 223.75 crore from seven private sugar mills, most of them owned by politicians.
 subsidy of Rs 50 per quintal on the State Advised Price (SAP) of Rs 280-Rs 295 per quintal of sugarcane was extended not only to the seven private mills, but also the nine cooperative mills in the state in November 2015 as the sugar prices in the market plummeted to a record Rs 2,400 per quintal.
However, within months the sugar prices in the market rose to Rs 3,800-Rs 4,300 per quintal, but the then SAD-BJP government continued to give the cash assistance to the mills. The issue of this largesse to private mills owned by a former Congress minister, Akali leaders, the family of a deceased liquor baron and an adviser to the previous government was raised by The Tribune following which a committee was set up.

The committee concluded that the seven private sugar mills made a huge profit running into crores after the sugar prices zoomed in the market, while pointing out that the subsidy was required to be given only when the wholesale sugar prices varied between Rs 2,500 and Rs 3,000 per quintal.

The then government started issuing notices for recovery and the mills approached the judiciary on whose directions a committee was formed under the Chief Secretary in November 2017. In its report submitted in April 2018, this committee concluded that the cash aid was given as a temporary support to alleviate farmers’ suffering and that the amount paid to the mills must be recovered.

Farmers await dues

5 pvt mills yet to release to farmers dues amounting to Rs305 cr
Coop mills owe Rs130 crore to cane growers for past 2 seasons

State Advised Price (SAP) is the price set by state governments. It is the price that mills would have to pay farmers instead of the FRP. It strengthens farmer's interests.