Uttar Pradesh’s unpaid farmers who are owed ₹128 billion will express their anger with ballot ink


  • The first phase of polling in India’s general elections commences today, and eight out of 80 seats allocated to Uttar Pradesh in the Lok Sabha will be up for grabs.
  • As the state’s farmers head to polling booths, one particular issue will likely weigh on their minds: sugarcane arrears.
  • Up until this month, the amount of unpaid dues owed to sugarcane farmers in UP, excluding interest, was around ₹128 billion - accumulated from the past three fiscal years owing to a glut in production.

The first phase of polling in India’s general elections commences today, and eight out of 80 seats allocated to Uttar Pradesh in the Lok Sabha will be up for grabs.

As the state’s farmers head to polling booths, one particular issue will likely weigh on their minds: sugarcane arrears.

Up until this month, the amount of unpaid dues owed to sugarcane farmers in UP, excluding interest, was around ₹128 billion - accumulated from the past three fiscal years owing to a glut in production which has, in turn, reduced the market prices that mills are able to sell sugar at. Concurrently, the government is reluctant to raise the minimum support price to the extent mills want because it is hesitant about the effects on consumer prices.

With around 3.5 million sugarcane farming households in UP, the issue has been a key point at rallies.

At a rally earlier this week, Samajwadi party leader Akhilesh Yadav berated the state government for its inability to settle sugarcane arrears. In fact, the issue was seen as one of the major reasons that the BJP lost a bypoll election in June last year for the Kairana constituency.

However, the BJP-led government is reportedly moving ahead with a plan this week to reduce that burden by ₹41 billion through by directly releasing funds to private and state-owned mills as well as offering them soft loans through a central government scheme.

Whether this will have an impact on the results of the election come counting day remains to be seen.

What is clear though, is that this won’t have too positive an effect on the first phase of polling in UP. All of the eight seats in contention in the first week are in the Western region of the state, where around 60% of the arrears are concentrated. However, the main mills in this region have reportedly been deemed ineligible for the scheme.

Skepticism in voter’s minds will also be high, given that this isn’t the first time the UP government has tried to alleviate the problem. In September last year, it set a deadline of end-November for the state’s 94 private sugar mills to settle dues after providing them with soft loans - which didn’t come to fruition.



SEE ALSO:

India could soon become the world’s largest sugar producer but here’s why that’s a problem

Centre grants debt relief to sugarcane farmers with soft loans

India's curbing its sugar surplus by incentivising ethanol production
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