Sugarcane farmers, sugar mill owners lock horns over pending dues

According to the Indian Sugar Mills Association, sugar mills in Uttar Pradesh owe sugarcane farmers Rs 6,480 crore. A few days back, state chief minister Yogi Adityanath had promised that the farmers would get their due by August 31. The promise was not met with and the farmers are now protesting

Mithilesh DubeyMithilesh Dubey   13 Sep 2019 6:18 AM GMT

"I should have got my due of Rs 80,000 in May, but I still haven't got. I have been to the sugarcane mill many times. They just don't listen. The bank has sent me a notice. If I don't pay up, they would deactivate my account. How can I pay up, if I am not getting my dues back," asked Piyush Kumar, a sugarcane farmer.

Piyush lives in Akhlora village, 20 kms from the district headquarters Muzaffarpur, in Uttar Pradesh, which is known for its sugarcane mills. In this district, one can see sugarcane fields for miles, but the farmers here are unhappy.

Saharanpur, Kairana, Muzaffarnagar, Bijnor, Meerut and Bagpet districts in the Western Uttar Pradesh are known for bumper production of sugarcane.

"Earlier, I used to sow sugarcane in my 30-acre farm, not anymore. We don't get our due in time, which is why we are not able to pay our loan. I had taken a loan of Rs 1 lakh in 2014. I did pay it back in instalments, but now because of high-interest rates, I still owe them more than a lakh. The bank employees are pressurising me," said Piyush.

A notice sent by the bank to Piyush Kumar, a sugarcane farmer.A notice sent by the bank to Piyush Kumar, a sugarcane farmer.

According to the Indian Sugar Mills Association, the sugar mills in Uttar Pradesh owe sugarcane farmers Rs 6,480 crore. A few days back, Uttar Pradesh chief minister Yogi Adityanath and state head of sugarcane industries had promised that by August 31, the sugarcane farmers would get their due at any cost. The promises were not met with and the sugarcane farmers are now protesting. In Bijnor district, thousands of farmers protested at the collectorate recently. In Bijnor and Meerut too the farmers are protesting.

Vicky Sharma, who lives in Makhannagar village in Meerut district, said: "The sugar mills owe me Rs 2 lakh. I was to get my due in April, but I still haven't. Farming is all I can do. In such a scenario, I need money to sow something else, but I don't have enough cash."

Mounting debts

Sixty-four-year old Dr Krishna Kumar Tyagi is under a debt of Rs 10 lakh. He had taken a loan in 2013. He couldn't pay back, so the bank sent him a notice. Last year,he had to spend 14 days in jail for defaulting.

He said: "I had taken separate loans for farming and my dairy business. I paid the loan taken for the dairy business, but couldn't repay the loan taken for farming under Kisan Credit Card as I had taken that loan for organic farming. The crop got damaged and I couldn't pay the money back."

"In October last year, I was arrested, even though I was supposed to get Rs 60,000 from one of the sugar mills," he added.

VM Singh, who has been fighting for these farmers for years now and is the national head of the Rashtriya Kisaan Majdoor Sangathan said: "As per the order dated August 6, 2012, the sugarcane farmers shouldn't be sent the notice of the Receivable charges which the banks are sending them till they get their dues. The Allahabad high court had even said that they should also get an interest on the amount due, but the state government did not bother."

According to the Uttar Pradesh Sugarcane (Regulation of Supply and Purchase) Act, if the sugarcane farmers don't get their due within 14 days of supplying sugarcane to the mills, the mills are supposed to give them interest on the amount that they are supposed to get.

On September 2, farmers in Bijnor were protesting under the banner of Rashtriya Kisan Majdoor Sangathan.On September 2, farmers in Bijnor were protesting under the banner of Rashtriya Kisan Majdoor Sangathan.

"When the court asked the sugarcane commissioner, he said that the mills would not be able to part with 15% interest rate, but they would consider giving 7%. After this, the commissioner even submitted an affidavit on April 5. It's been five months since then, but not a single farmer has got any interest. The government even said the action would be taken against those mill owners who would fail to pay the interest rate," Singh added.

On September 2, farmers in Bijnor were protesting under the banner of Rashtriya Kisan Majdoor Sangathan. The state head of the unit, Kailash Lamba, had then said: "The farmers deserve their hard-earned money. The mills are not paying the farmers, forget about them getting any interest rate. The farmers are not in a position to pay their electricity bill or pay their bank loans back. The banks are declaring them defaulters, which is not fair."

Awadhesh Kumar Mishra, additional district magistrate (finance and revenue), Bijnor, said: "Only those farmers are being served with Receivable Charges notice who have not repaid loans since long. We are trying our best so that they get their dues. We are meeting with the farmer leaders every day. Some mills here have been defaulting, but we are still better off compared to other districts in the state."

Vinod Kumar, the district head of Rashtriya Kisan Majdoor Sangathan, said: "The court has said if the farmers are not getting their dues, they should at least get the interest rate. The chief minister of Uttar Pradesh had ordered the mills to pay the farmers by August 31, but nothing happened after that."

The sugar mills owe farmers in Bijnor Rs 572 crore. When the farmers were protesting on September 3, additional district magistrate Brijesh Kumar Singh and district sugarcane officer had assured them they would get Rs 25 crore. They had even promised to take action again errant mill owners. But the farmers aren't satisfied.

Goan Connection tried contacting district sugarcane officer Yashpal Singh, he said he was in a meeting.

The Allahabad High court orderThe Allahabad High court order

What's the solution?

Uttar Pradesh tops in terms of sugarcane production.It comes close second after Maharashtra in terms of sugar production. Around 44 districts in Uttar Pradesh produce sugarcane, of which 28 are known for sugarcane production. There are around 119 sugar mills in the state and around 35 lakh farmers are associated with these mills.

During the 2018-19 crushing season, the farmers were to get Rs 33,047 crore, but they got only Rs 6,480 crore, which was 20% of the amount due. In the same period in 2017-18, they were to get Rs 10,000. The amount which they got was 28% of the due amount. The farmers, however, didn't suffer thanks to several loan schemes announced by the state and Centre government. The 2019-20 crushing season is just less than two months away.

Talking about this, VK Shukla, additional head, sugarcane, of the Uttar Pradesh mills and sugarcane industry said: "We have paid Rs 26,642 crore so far this season. The present government has so far paid Rs 72,701 crore." He didn't answer questions related to why haven't the farmers received their dues and why isn't the government taking any action against the errant mill owner.

If these figures are to be believed, the total dues in Uttar Pradesh stand at Rs 6,605 crore.


Other districts are suffering too

Apart from Bijnor even in Muzaffarpur and Meerut farmers haven't got their dues. The Muzzafarpur district sugarcane head, RD Dwiwedi, told Gaon Connection over the phone that until August 31 last year Rs 686 crore were pending. The amount now stands at Rs 420 crore. "The dues of one mill stands at Rs 220 crore, which is 50% of the total due. These mills don't get any credit from the banks. They pay the farmers only after they manage to sell the sugar. This means the farmers get their due only after 2-3 months."

Gaon connection met Ankit Sherawat, head of Rashtriya Lok Dal. He said: "The state government should have kept its promise. The farmers are distressed. They would be able to sow their next crop only after they will get the money. But the sugar mills are not bothered. They are not paying them even after the state's order. The state government should take strict action against them."

In Meerut too the mills have to pay back Rs 1,554 crore. There are 6 mills in Meerut. Sugarcane district head Dr Dushyant Kumar said: "We have paid Rs 1,753 crore. We still have to pay Rs 555 crore."

Recently,the Uttar Pradesh sugarcane head, Manish Chauhan, had taken stock of the sugarcane mills situation. Various aspects like selling quota, export, export subsidy were taken into account.

In 2017-18,the demand stood at 1.2 crore tonne, but only 1.18 crore was produced. The next season will start at the end of October. The mills will start functioning during Diwali. Other mills will start work by November. It remains to be seen if the situation changes.

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