UP sugar talks break down, FIRs lodged against millers

Talks between the Uttar Pradesh (UP) government and private sugar millers to resolve the crushing crisis unexpectedly broke down on Wednesday.

The government has started taking action against mills in western UP for breaching the Monday deadline to start operations.

First Information Reports (FIRs) have been lodged under the Essential Commodities Act against Tarun Sawhney of Triveni Engineering & Industries and Gautam Goel of Dhampur Sugar Mills. Both units are in the Muzaffarnagar district. FIRs were also reportedly lodged against Simbhaoli Sugar Mills in Ghaziabad and two others in Hapur and Sambhal.

The millers have demanded the quashing of the FIRs, so the latter do not “vitiate the complicated situation for which all are trying to find a solution.” “We would like to say the promoters should not be singled out for coercive action. The promoters are prepared to face such action together,” a UP Sugar Mills Association (UPSMA) statement to Chief Secretary Jawed Usmani said.

The millers had held three rounds of talks, two with Chief Minister Akhilesh Yadav and the third with Usmani on Wednesday morning. The millers said they could not start crushing with the cane price at Rs 280 a quintal unless the government gave relief. The mills said a price above Rs 225 a quintal would mean losses and dues.

The millers had also offered to run units provided the government agreed to bear the losses.

Meanwhile, the mills have told the government if they received interest-free loans, the money would be used to clear the dues (Rs 2,400 crore) from the 2012-13 crushing season to farmers.

Of the 123 mills, 99 are private. The delay in crushing has caused anxiety among the four-million cane farmers in UP, which produces a third of India’s sugar output.  

HC warns of ‘social effects’
Taking a grim view of the “social consequences” of non-functioning of most private sugar mills and a number of state-owned ones, the Allahabad high court on Wednesday asked the government to find a “just and equitable solution”. Hearing a public interest suit of Rashtriya Kisan Mazdoor Sangathan, the court took a note of the submission “68 of 99 private sugar mills had sent closure notices to the state on November 19 and another eight on November 20.”     

“It is also stated that distress sale of cane is taking place in various parts due to the non-functioning of the mills,” the court observed.