Fixing sugarcane support price a thorny affair

Sugar factoryIt may not be wrong to say that Pakistan suffers from ‘sugar politics’ and the worst sufferers are consumers who have to pay the cost of inefficiency of farmers and mills.
It is also true that majority of sugar mills is owned by politicians and feudal lords turned industrialist. The situation is the most precarious in Punjab, where mills have been established in cotton growing belt. To lure the farmers, sugarcane support price in the province is also fixed higher.
The situation in Sindh is bad but not as precarious as that of Punjab. Mills are happy because they are able to achieve higher recovery and farmers are also able to live with lower price as they succeed in achieving higher yield. Last year growers in Sindh got much lower price as compared to the price paid to sugarcane growers in Punjab.
In my previous blog, sugar industry deserves no sympathies, I held the government responsible for allowing construction of sugar mills in the cotton growing belt. The most appropriate decision will be to dismantle some of these mills and relocate these in Sindh.
The reason for making such a radical suggestion is based on simple logic. Soil composition and climatic conditions of Sindh are more conducive for cultivation of sugarcane. As the crop is water intensive its cultivation in Punjab is sheer waste of the scarcest resource of the country.
The mills demand subsidy, which is not right because tax payers’ money just can’t be used for patronizing inefficiencies. They also not be given any subsidy on export. Why should the local consumers be penalized?
Making cost audit mandatory for sugar mills will be the most appropriate step. This will help in determining which the inefficient ones are. If such a mill is a public limited company, bringing change in its ownership will also be an appropriate step.

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