The Indian sugar industry supports food security, employment, and foreign exchange earnings. India produces the second-most sugar after Brazil. India produced 35 million tonnes of sugar in 2021-22, 20% more than demand.
The Indian sugar industry faces many problems, including:
- Surplus production: India produces the second-most sugar after Brazil. India produced 35 million tonnes of sugar in 2021-22, 20% more than demand. This surplus production has lowered sugar prices, hurting the sugar industry.
- High input costs: India produces sugar at a high cost. Labor, fertilizers, and sugarcane are the main inputs. Recent price increases for these inputs have put pressure on the sugar industry.
- India competes with sugar-producing nations like Brazil and Thailand. These nations sell sugar at lower prices due to lower production costs.
- The government has imposed minimum export prices and sugar quotas on the sugar industry. These policies have hindered the sugar industry’s profitability.
The problems faced by the sugar industry have led to a number of challenges, including:
- Low sugar prices are causing financial stress for the sugar industry. Sugar mills are losing money and can’t pay their loans.
- Job losses: The sugar industry employs millions. The industry’s problems have cost jobs.
- Distressed farmer: Sugarcane farmers are hardest hit by industry issues. Low sugar prices hurt sugarcane farmers.
The sugar industry has received government support in several ways:
- Export subsidies: The government subsidizes sugar exports. This helps the industry sell sugar abroad for more.
- Import restrictions: The government restricts sugar imports. This safeguards domestic sugar production from cheap imports.
- Sugar industry financial aid: The government provides financial aid. This helps the industry repay loans and survive.
- Restructuring sugar mills: The government plans to restructure sugar mills. This plan will boost sugar mill efficiency and profits.
Some sugar industry issues have been addressed by government actions. The industry still faces many challenges. The government must support the sugar industry to keep it viable and boost the Indian economy.