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By:

Rajendra Joshi

3 December 2024 at 9:20:26 am

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has...

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has raised serious questions about the role of intermediaries and the effectiveness of the Centre’s efforts to contain sugar prices. The margins available to traders and intermediaries have reportedly crossed 20 per cent, leaving sugar millers perplexed. At a time when both sugarcane growers and mill operators are under financial pressure, the trading chain appears to be benefiting disproportionately. The Centre must examine this growing disparity and take corrective measures to prevent speculative profiteering. Retail sugar prices began rising sharply in August, touching nearly Rs 70 per kg in some markets. The escalation added to inflationary pressures and caused concern among consumers, particularly ahead of the festive season. In response, the Centre introduced a series of measures to improve domestic availability and moderate prices. These included permitting duty-free sugar imports, initially until October 31, a deadline subsequently extended to December 31. The government also directed sugar mills to commence the crushing season from October 15 and tightened monitoring of sugar stocks. In another significant intervention, it modified the ethanol policy, restricting the diversion of sugarcane juice, sugar syrup and B-heavy molasses for ethanol production. Following these measures, sugar mills began witnessing a decline in the prices offered through their sale tenders. Recent transactions have fetched between Rs 4,600 and Rs 4,800 per quintal. Going by the conventional relationship between ex-mill prices and retail rates, sugar should ideally have been available to consumers at less than ₹50 per kg. However, retail prices continue to hover around Rs 58 per kg, pointing to a substantial disconnect between the mill gate and the consumer market. Traditionally, sugar retailing operated on relatively thin margins. Since sugar is an essential commodity, retailers often treated it as a low-margin product to attract customers who would subsequently purchase other household provisions. The margin was sometimes informally equated with the resale value of the empty 50-kg jute bags in which sugar was supplied. This was considered a nominal return for retailers. That traditional pricing mechanism, however, appears to have undergone a significant change. The widening gap between mill-level tender prices and retail rates has created considerable scope for intermediaries to extract higher margins. The critical question is whether the additional amount paid by consumers is reaching the sugar mills or remaining within the trading chain. The issue assumes particular significance in Maharashtra, where the sugarcane pricing dispute has intensified ahead of the new crushing season. Farmers’ organisations have been demanding a minimum price of Rs 5,500 per tonne for sugarcane. Millers, meanwhile, are preparing to agitate for a revision in the Fair and Remunerative Price (FRP) framework and the restoration of a more supportive ethanol policy. The Swabhimani Shetkari Sanghatana, led by Raju Shetti, has taken a firm position that sugar mills should not be allowed to commence operations until farmers receive an acceptable price for their cane. Shetti has also drawn the state government’s attention to the unusually high retail prices of sugar, questioning why consumers continue to pay more even as mills are forced to sell at relatively lower rates. The Centre’s sudden changes to the ethanol policy have further complicated the industry’s financial position. Ethanol production had emerged as an important revenue stream for sugar mills, enabling them to diversify operations, improve cash flows and enhance their capacity to pay farmers. Restrictions on the diversion of sugarcane-based raw materials have weakened this support at a critical juncture. The resulting contradiction is difficult to ignore: farmers are demanding better cane prices, millers are struggling with shrinking realisations and policy uncertainty, while intermediaries appear to be benefiting from the gap between wholesale and retail prices. The government cannot address the sugar crisis merely by regulating mill stocks, imports and ethanol diversion. It must also examine the entire supply chain, identify where the widening margins are accruing and ensure that the benefits of market interventions reach both sugarcane growers and consumers. With nearly Rs 2 lakh crore riding on the sugar economy, allowing intermediaries to thrive while the industry’s primary stakeholders struggle would be a serious policy failure.

Hurray! A Book Stalls Parliament

Feb 16
4 min read

A retired general’s unpublished memoir has succeeded in briefly forcing India’s lawmakers to argue with ideas rather than one another.

I love following Indian politics from close quarters, however dirty, self-seeking and theatrical it may be. Yet I am drawn less to its daily intrigue than to the aroma of books and the knowledge-filled contents they carry. Between beautiful books and pitiable politics, books win hands down.


Consider, for a moment, the power of the written word. One is reminded of the old adage about the pen being mightier than the sword. In this instance, a book proved stronger than politicians. The Indian Parliament, meant to solve citizens’ problems, protect national borders, make life easier through a balanced budget, pass laws to save the innocent and punish the criminal, or take stern steps to curb corruption, found itself debating a book and its contents. What a heavenly interlude it turned out to be.


Instead of the irritating, financially burdensome slugfests between the treasury benches and the Opposition, what India witnessed over nearly ten days were heated discussions around a book written by a former Chief of Army Staff, General M. M. Naravane, who superannuated in April 2022. His memoir, which touches on warfare and military leadership and makes liberal references to China and Pakistan, is titled Four Stars of Destiny. It is to be published by Penguin Random House. An article on the book, available online, went viral long before the volume itself reached bookshops.


Irksome Manuscript

The frank description of a 42-year journey of a general whose military record has been spotless appears to have irked the government no end. That the officer was not appointed Chief of Defence Staff is a subject for another occasion. What mattered here was not the politics of promotion, but the politics of publication.


What gladdened me was the sudden shift of attention - from acrimonious charges and counter-charges - to a book. The Leader of the Opposition, Rahul Gandhi, was seen flashing it in the House. He was not permitted by the Speaker to read out excerpts, a procedural decision that falls squarely within the Speaker’s remit. That political skirmish is of lesser interest here. What matters more, at least in this column, is that a book rather than a slogan momentarily commanded Parliament’s attention.


The reaction was swift and theatrical. In retaliation, a plethora of books on Jawaharlal Nehru, his daughter Indira Gandhi, and the Emergency she imposed in the mid-1970s suddenly made their way into the sanctum sanctorum of Parliament. The resurfacing of books on Nehru and Indira - the bêtes noires of the BJP - amounted to a book-for-book response by ruling-party MPs, many of whom may not have read the volumes they were brandishing.


The Lok Sabha Library, with its vast and well-catalogued holdings, must have come to the rescue. Having visited it myself on several occasions, I can imagine how elated the staff of this great parliamentary library must have been to see books being taken off the shelves, dusted, and carried into the hollowed precincts of the Lower House. Old and pale volumes on Nehru, Indira, Lady Mountbatten and others, long untouched by most MPs, should feel grateful to Rahul Gandhi and M. M. Naravane for allowing them to see daylight again, this time inside the brand-new Parliament building designed by Bimal Patel.


A large section of Indians, frankly, does not expect modern-day politicians to be a well-read lot. There have been honourable exceptions. In the BJP, figures such as Atal Bihari Vajpayee, Sushma Swaraj, M. M. Joshi, L. K. Advani, Sumitra Mahajan and Subramanian Swamy stood apart. Across parties, stalwarts such as B. R. Ambedkar, Ram Manohar Lohia, Madhu Dandawate, Madhu Limaye, Piloo Mody, Indrajit Gupta, S. A. Dange, V. N. Gadgil, Somnath Chatterjee, Arjun Singh and, of course, Nehru himself were voracious readers.


Scholarly Arguments

They made scholarly arguments in Parliament, often supported by books from their personal libraries. I have had the privilege of seeing some of these collections. Many of these politicians were also frequent visitors to the Lok Sabha Library. Jairam Ramesh, a Congress MP and an author himself, remains one of its regular users. Admittedly, those were different times. Politics was more mature, and intellectual curiosity was not treated as a liability.


Trying to recall when a book last triggered such controversy in Parliament is an uphill task. School textbooks have caused smaller disturbances. It is unclear whether the Union Bank of India’s questionable decision to buy two lakh copies of a book by a former chief economic adviser agitated MPs even for a single day.


Salman Rushdie’s The Satanic Verses did ignite debate, though not with the intensity witnessed in February 2026. That book was banned in India for decades before the ban was lifted in 2025. Exiled Bangladeshi writer Taslima Nasrin, too, stirred a hornet’s nest in 2003 when Lajja (Shame) provoked widespread anger. Her autobiography Dwikhandito was banned in West Bengal. Those episodes reverberated through legislatures but rarely paralysed them.


Undoubtedly, Naravane’s yet-to-be-published book has made history. ‘The Four Stars of Destiny’ may not change the destiny of the retired general or Rahul Gandhi, but book aficionados like me are glad about Gandhi and Naravane for letting a book dominate the Indian Parliament. Long live books!


(The writer is a senior political and environmental journalist based in Bhopal. Views personal.)

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