With sugar prices improving and helping mills, the central government announced it had raised its "Fair and Remunerative Price' of sugarcane for the 2017-18 season that starts from October by Rs 25 a quintal, to Rs 255 a quintal, the first increase in two years.
This decision of the Cabinet Committee on Economic Affairs (CCEA) will impact about 50 million farmers. The FRP is a recommendation to states (which can raise it) on a minimum price that mills have to pay to cane farmers. It was kept unchanged at Rs 230 a qtl for the current 2016-17 year (October-September).
CCEA also approved the raising of Rs 2,360 crore through bonds for renewable energy projects in this financial year.
The cane price increase is likely to result in states which do ot adopt the Centre's FRP, such as Uttar Pradesh, raising their own minimum prices. UP, Punjab and Haryana fix their own 'State Advisory Price' (SAP), higher than the Centre's FRP.
The FRP is linked to a basic recovery rate of 9.5 per cent, subject to a premium of Rs 2.68 a quintal for every 0.1 percentage point increase in the recovery. It has been fixed on the basis of recommendations of the Commission for Agricultural Costs and Prices.
Sugar prices have increased this year, due to an estimated fall in production of about 20 million tonnes this season, from 25 mt the previous year. Cane production this year had declined by 12 per cent to about 306 mt, due to drought in Maharashtra and Karnataka.
Noida Metro: The Centre will partially fund a Noida-Greater Noida metro rail corridor being built close to the national capital at a cost of Rs 5,500 crore. The Cabinet formally approved the project, being implemented by Noida Metro Rail Corporation. This will allow the Centre to provide Rs 970.6 crore "in equity and subordinate debt".
Assam AIIMS: Also approved on Wednesday was the setting up of an All India Institute of Medical Sciences at Kamrup, Assam, to offer super-speciality health care.
Organ transplant: Also approved was the signing of a pact between the health ministries of Spain and India on cooperation in organ transplant services.
Waterways: Allocation was approved for national waterways of 2.5 per cent of the Central Road Fund. This would result in about Rs 2,000 crore a year for their development.