The Union government has announced a package of more than Rs 8,000 crore aimed to provide relief to sugarcane farmers and to clear their dues. According to a government official, the package includes three elements. A buffer stock of 30 LMT (lakh metric tonnes) of sugar will be created with Rs 1,200 crore.
This money will be directly transferred to accounts of sugarcane farmers. Rs 4,400 crore will be used to increase ethanol production to divert sugarcane away from sugar mills which are unable to dispose of their inventories. The government has also decided to ensure a minimum sale price of Rs 29/kg for sugar.