Mumbai: The Centre's decision to halt sugar exports until September 30 has sent shockwaves through Maharashtra's sugar industry, raising concerns over factory finances, farmer payments, and the broader rural economy.
Maharashtra, one of India's top sugar-producing states, had recorded higher production this year, with output rising by 1.8 million tonnes compared to last season. However, the sudden export ban imposed in the middle of the season has stalled a significant portion of the state's approved export quota, Hindustan Times reported.
Out of the 488,000 tonnes allocated to Maharashtra, around 325,000 tonnes have either been exported or are tied up in agreements. Industry officials say nearly 30-40% of the remaining quota is now on hold, creating a cash flow problem for sugar mills.
Experts from the cooperative sugar sector warn that the move will slow down liquidity for factories, making it harder for them to clear dues owed to sugarcane farmers under the Fair and Remunerative Price (FRP) system.
The decision has also surprised industry stakeholders, coming shortly after Union Food Secretary Sanjeev Chopra had indicated that such a ban was unlikely. While the government aims to control domestic sugar prices, industry representatives argue that the timing of the restriction is not justified.
Officials from the Maharashtra State Cooperative Sugar Factories' Federation said the mid-season policy shift could affect India's credibility in global markets, as export agreements now face uncertainty.
The move has drawn sharp political reactions as well. NCP leader Sharad Pawar described the ban as "economically disastrous" for the state's cooperative sugar sector and called for an immediate review of the decision.
He warned that cutting off access to export markets would reduce the cash flow needed by mills to meet their legal obligation of paying farmers. According to him, the industry had just begun to benefit from international demand, and the ban could push mills towards financial distress.
Farmer leader and former MP Raju Shetti also criticised the move, saying it would hurt the sugar economy in both Maharashtra and the country. He questioned how mills would honour existing export agreements and maintain operations without the income from exports.
The export ban comes at a time when farmers in the state are already facing challenges on multiple fronts. In a separate protest over falling onion prices, members of the Maharashtra Kisan Congress staged demonstrations outside Mantralaya, throwing onions at the gates to express their anger. Police detained several protestors during the agitation.
Adding to the unrest, mango and cashew farmers from the Konkan region have planned a march demanding higher compensation for crop losses this season.
With mounting pressure from industry leaders and farmers, the export ban has quickly turned into a key economic and political issue in Maharashtra, with calls growing for the Centre to reconsider its decision.