Addressing sugar industry representatives and legislators at Suvarna Vidhana Soudha in Belagavi on October 26, Shivakumar called for coordinated efforts by farmers, factory owners, and the Union and state governments. He stressed that farmers and sugar mills depended on each other for their sustainability and said a mutually acceptable solution was necessary to address their concerns.
Recalling the previous government’s decision to raise the State Advised Price (SAP) of sugarcane to Rs 3,300 per tonne, Shivakumar said the additional cost was to be shared between the state government and sugar mills. Nearly 80% of factories had made the payments, but some mills failed to comply and approached the courts, weakening farmers’ trust in the industry.
Farmers are now seeking compensation of up to Rs 6,000 per tonne. According to Shivakumar, they have cited the lack of an increase in sugar prices over the past decade and the Centre’s failure to revise the Minimum Selling Price (MSP) of sugar as key reasons behind their demand.
The Chief Minister also highlighted the financial and operational challenges facing sugar mills, including banking issues and uncertainty over ethanol and power pricing. He said these concerns were not confined to Karnataka, with similar issues being reported in Maharashtra, Andhra Pradesh, Telangana, Bihar and Uttar Pradesh. Calling for a national-level response, he stressed the need to address the difficulties affecting the sector across states.
Shivakumar said he had discussed the matter with the Maharashtra Chief Minister, while Union Minister Pralhad Joshi was also looking into the concerns. He urged sugar industry representatives and legislators to present their views to the Centre to help facilitate a settlement between farmers and mill owners.
Highlighting the impact of inadequate rainfall, Shivakumar said sugarcane yields and production had declined, making it necessary to bring the situation to the Centre’s attention. He also pointed to the rising cost of providing free electricity to farmers’ pump sets in Karnataka.
The state government currently spends around Rs 20,000 crore annually on free electricity for farmers’ pump sets. This expenditure was expected to rise to Rs 32,000 crore this year because of higher consumption amid poor rainfall, he said.
Shivakumar urged sugar mills to rebuild farmers’ confidence and called on all stakeholders to prevent a recurrence of last year’s incidents of vehicle arson during protests. His remarks underscored the need for a settlement that addresses farmers’ compensation demands while taking into account the financial pressures facing sugar mills and the wider challenges confronting the sugar industry.
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