The Centre has decided to pay a production subsidy of Rs. 4.50/quintal directly to cane farmers in the 2015-16 season to ensure they get timely payment of arrears amounting to over Rs. 7,000 crore owed by sugar mills. The move is expected to cost the exchequer about Rs. 1,147 crore.
Simultaneously, the government also notified a minimum indicative export
quota (MIEQ) for sugar mills and has tied the production subsidy to
only those mills that meet 80 per cent export and ethanol blending
targets.
A decision in this regard was taken by the Cabinet Committee on Economic Affairs (CCEA) on Wednesday Nov 18,2015
Incidentally, the Food Ministry had proposed a production subsidy of Rs. 4.75/quintal out of the cane FRP of Rs. 230/quintal for the 2015-16 season that covers October-September.
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