{"id":4606,"date":"2022-10-07T00:00:00","date_gmt":"2022-10-07T00:00:00","guid":{"rendered":"https:\/\/www.nextias.com\/current_affairs\/uncategorized\/07-10-2022\/sugar-production-in-india\/"},"modified":"2022-10-07T00:00:00","modified_gmt":"2022-10-07T00:00:00","slug":"sugar-production-in-india","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/07-10-2022\/sugar-production-in-india","title":{"rendered":"Sugar Production in India"},"content":{"rendered":"<p style=\"text-align:justify\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>In News<\/strong><\/span><\/span><\/p>\n<ul>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">India overtakes other countries to become the<\/span><span style=\"font-size:12pt\"><strong> world\u2019s largest producer, consume<\/strong><\/span><span style=\"font-size:12pt\">r of Sugar, and second largest exporter of sugar.<\/span><\/li>\n<\/ul>\n<p style=\"text-align:justify\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>Key Points<\/strong><\/span><\/span><\/p>\n<ul>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Production:\u00a0<\/strong><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">A record amount of sugarcane\u2014more than 5000 Lakh Metric Tons (LMT)\u2014was produced in the nation during the sugar season Oct. to Sep. (2021\u201322), of which around 3574 LMT was crushed by sugar mills to make about 394 LMT of sugar (Sucrose).\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Out of this, 359 LMT of sugar was produced by sugar mills, while 35 LMT of sugar was diverted to the manufacturing of ethanol.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Exports:\u00a0<\/strong><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Exports brought in Rs. 40,000 crores in foreign currency<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">The largest exports of 109.8 LMT, which were made without any financial aid and continued through 2020\u201321, is another achievement of the season.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">It became possible because:\u00a0<\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">This achievement of the Indian sugar industry was made possible by <\/span><span style=\"font-size:12pt\"><strong>favourable worldwide prices and Indian Government Policy<\/strong><\/span><span style=\"font-size:12pt\">.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">Employment and Jobs:\u00a0<\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">In addition to having a significant impact on the rural livelihoods of the approximately 5 lakh directly employed individuals in sugar mills and the 50 million sugarcane farmers, the sugar industry is a major agro-based sector.\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Additionally, jobs are created in a number of ancillary activities related to transportation, machine repair, and the provision of agricultural inputs.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">Output from sectors:<\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">The current annual output of the Indian sugar industry is approximately Rs. 80,000 crores. As of 31 July 2017, the country had 732 installed sugar factories with enough crushing capacity to generate around 339 lakh MT of sugar.\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">The capacity is split almost evenly between units in the cooperative and private sectors.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>No financial aid needed till now:\u00a0<\/strong><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Without any financial help (subsidy) from the government, sugar mills bought sugarcane worth more than 1.18 lakh crore and released payments totaling more than 1.12 lakh crore during Sugar Season(SS) 2021\u201322.\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Therefore, the fact that the cane debt at the end of the sugar season is less than 6,000 crore indicates that <\/span><span style=\"font-size:12pt\"><strong>95% of the cane debt has already been paid<\/strong><\/span><span style=\"font-size:12pt\">.\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">It is also significant that more than 99.9% of the cane dues are paid for SS 2020\u201321.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">Revenue from Ethanol sale:\u00a0<\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">The growth of ethanol as a biofuel sector in the last five years has greatly aided the sugar sector.<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">The conversion of sugar to ethanol has resulted in better financial positions for sugar mills due to:<\/span>\n<ul>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">Faster payments,\u00a0<\/span><\/li>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">Reduced working capital requirements, and\u00a0<\/span><\/li>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">Less fund blockage due to less surplus sugar with mills.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\">Sugar mills\/distilleries made around 18,000 crores in revenue from the sale of ethanol during 2021-22, which also played a role in the early settlement of farmers\u2019 cane dues.\u00a0<\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><strong>Expansion predicted:\u00a0<\/strong><\/span>\n<ul>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">Sugar diversion to ethanol is predicted to expand from 35 LMT to 50 LMT in the upcoming season, generating approximately 25,000 crores in revenue for sugar mills.<\/span><\/li>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">The government has been encouraging sugar mills to divert sugar to ethanol and export surplus sugar so that sugar mills can pay cane dues to farmers on time and mills can operate in better financial conditions<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"text-align:justify\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>Sugar<\/strong><\/span><\/span><\/p>\n<ul>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">Pricing policy :<\/span><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">The concept of Statutory Minimum Price (SMP) of sugarcane was replaced with the \u2018Fair and Remunerative Price (FRP)\u2019 of sugarcane for 2009-10 and subsequent sugar seasons with the amendment of the Sugarcane (Control) Order, 1966 in 2009.<\/span><\/span>\n<ul>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">Under the FRP system, the farmers are not required to wait till the end of the season or for any announcement of the profits by sugar mills or the Government.\u00a0<\/span><\/li>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">The new system assures margins on account of profit and risk to farmers, irrespective of the fact whether sugar mills generate profit or not and is not dependent on the performance of any individual sugar mill.<\/span><\/li>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">The FRP has been determined on the basis of recommendations of the Commission for Agricultural Costs and Prices and after consultation with State Governments and other stakeholders.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">Sugar Subsidy:<\/span><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">Sugar was distributed through the Targeted Public Distribution System (TPDS) by the States\/UTs at subsidized prices for which the Central Government was reimbursing @ 18.50 per kg of sugar distributed by the participating State Governments \/UT Administrations.\u00a0<\/span><\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">The scheme was covering all BPL population of the country as per 2001 census and all the population of the North Eastern States \/ special category\/ hilly states and Island territories.\u00a0<\/span><\/span>\n<ul>\n<li style=\"list-style-type:square\"><span style=\"font-size:12pt\">The National Food Security Act, 2013 (NFSA) is now being universally implemented by all 36 States\/UTs. Under the NFSA, there is no identified category of BPL; however, the Antyodaya Anna Yojana (AAY) beneficiaries are clearly identified.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">Location of Sugar Industry in India:<\/span><\/span>\n<ul>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">Sugar industry is broadly distributed over two major areas of production- Uttar Pradesh, Bihar, Haryana and Punjab in the north and Maharashtra, Karnataka, Tamil Nadu and Andhra Pradesh in the south.<\/span><\/span><\/li>\n<li style=\"list-style-type:circle\"><span style=\"font-size:12pt\"><span style=\"color:#000000\">South India has <\/span><\/span><span style=\"font-size:12pt\"><span style=\"color:#000000\"><strong>tropical climate<\/strong><\/span><\/span><span style=\"font-size:12pt\"><span style=\"color:#000000\"> which is suitable for higher sucrose content giving higher yield per unit area as compared to north India.<\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>\u00a0<\/p>\n<p style=\"text-align:justify\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>Challenges for Sugar Industry in India<\/strong><\/span><\/span><\/p>\n<ul>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Dependence on Monsoon:<\/strong><\/span><span style=\"font-size:12pt\"> Apart from irrigation equipped northern states, Sugarcane is largely grown in rainfed regions of central and southern India. So, a good monsoon becomes extremely important.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Hurdle for Export of surplus sugar:<\/strong><\/span><span style=\"font-size:12pt\"> The international sugar prices are low compared with India\u2019s domestic raw sugar price by almost Rs.12 \u2013 Rs.13 a kg, creating low incentive for export of surplus sugar. Due to inadequate exports, farmers are not compensated well for the produce.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Low Productivity:<\/strong><\/span><span style=\"font-size:12pt\"> India has the largest area under sugarcane cultivation in the world but the yield per hectare is extremely low and is even lower in North India than in South India.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Low Sugar Recovery rate:<\/strong><\/span><span style=\"font-size:12pt\"> Average rate of sugar recovery from the sugar cane is less than 10% whereas in other sugar producing areas like Java, Hawaii and Australia, it is 14%.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\"><strong>Government Pricing Policy:<\/strong><\/span><span style=\"font-size:12pt\"> The government policy, based on a dual price system, discourages the entrepreneurs from making investment for further growth and improvement.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">Short smashing season:<\/span><span style=\"font-size:12pt\"> Sugar creation is an occasional industry with a short smashing season-changing regularly from 4 to 7 months in a year. It causes monetary misfortune and occasional work for laborers and absence of full use of sugar plants.<\/span><\/li>\n<\/ul>\n<p>\u00a0<\/p>\n<p style=\"text-align:justify\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>Way Ahead<\/strong><\/span><\/span><\/p>\n<ul>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">In October, 2021, the government announced an incentive to encourage sugar companies to <\/span><span style=\"font-size:12pt\"><strong>divert excess sugar cane stock in producing ethanol<\/strong><\/span><span style=\"font-size:12pt\">, which can be blended with petrol and used as fuel in vehicles.<\/span><\/li>\n<li style=\"list-style-type:disc\"><span style=\"font-size:12pt\">Besides, this is also a <\/span><span style=\"font-size:12pt\"><strong>good solution<\/strong><\/span><span style=\"font-size:12pt\"> to address the problem of excess sugar production in the country.<\/span><\/li>\n<\/ul>\n<p>\n<span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><strong>Source<\/strong><\/span><\/span><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\">: <\/span><\/span><a href=\"https:\/\/newsonair.com\/2022\/10\/06\/india-emerges-as-worlds-largest-producer-consumer-of-sugar\/#:~:text=Out%20of%20this%2C%20359%20LMT,world%27s%20largest%20producer%20and%20consumer.\" style=\"text-decoration-line:none\" target=\"_blank\" rel=\"noopener\"><span style=\"font-size:13pt\"><span style=\"font-family:\"Book Antiqua\",serif\"><span style=\"color:#1155cc\">AIR<\/span><\/span><\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In News India overtakes other countries to become the world\u2019s largest producer, consumer of Sugar, and second largest exporter of sugar. Key Points Production:\u00a0 A record amount of sugarcane\u2014more than 5000 Lakh Metric Tons (LMT)\u2014was produced in the nation during the sugar season Oct. to Sep. (2021\u201322), of which around 3574 LMT was crushed by [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":4607,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[26,141],"class_list":["post-4606","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-affairs","tag-gs-3","tag-major-crops-cropping-patterns-of-india"],"acf":[],"jetpack_featured_media_url":"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2023\/07\/3317917Screenshot_20221007-123332_Android System.jpg","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/4606","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=4606"}],"version-history":[{"count":0,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/4606\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media\/4607"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=4606"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=4606"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=4606"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}