NEW DELHI: The government has denied that it was considering a proposal to create a buffer stock of sugar worth Rs250 crore to bail out the industry, which is expected to witness a bumper crop of 230-240 lakh tonnes in the 2006-07 season, as against the expected demand of 190 lakh tonnes.
“There is no proposal under the consideration of the government to create a buffer stock of sugar,” Akhilesh Prasad Singh, minister of state for agriculture and consumer affairs, food and public distribution, told the Rajya Sabha in a written reply.
Singh was replying to a question on whether the government was considering any proposal to set up a buffer stock to bail out the sugar industry and remain in global competition. The sugar season in India runs from October to September.
In reply to a separate question, the minister said the government has not been approached by any industrial lobby to maintain a buffer stock of around 30 million tonnes.
However, the National Federation of Cooperative Sugar Factories and Indian Sugar Mills Association have approached the government, requesting the creation of buffer stocks of about two million tonnes, Singh said.
Singh talked about the rationale behind the eight-nine month long ban on sugar export that was imposed last year and said it was “in order to check the rise in prices”. The minister pointed out that the retail price of sugar in the open market had increased to Rs20-23 per kg in May 2006 from Rs17-21 per kg in December 2005.