Making the possible shortfall in water a pretext, the
administrative machinery, particularly in Sindh, tried to pressurize the
mills to commence sugarcane crushing earlier than the normal schedule.
However, the nature turned in favour of the mills due to some rainfall.
The field force was not willing to cut the sugarcane due to water
standing in the fields. Earlier, the workers had refused to commence
work in Ramazan. Now, it seems that most of the mills are in a position
to commence crushing during the first week of November. However, it is
yet to be seen how the field force behaves during the last week of
Ramazan and Eid holidays.
It has been quite some time that mills informed the
government about late commencement of crushing season because of low
recovery achieved in October. But more importantly the mills were forced
to contain number of crushing days due to inadequate availability of
sugarcane in Sindh. Since availability was better in Punjab, mills were
willing to operate the mills for longer duration. This year even the
mills located in Punjab also expressed their inability to commence early
crushing. However, it became an ego problem in Sindh, as the feudal
lords were able to pressurize the chief minister to force the mills to
start crushing earlier than the normal schedule. The farmers' lobby was
fully supported by the administration, to be precise by the Cane
The provincial government used Sugarcane Act as the
stick and the carrot was the promise to provide incentives for those who
follow the instruction. According to a sector expert, "The Act has
become virtually redundant. The objective for the promulgation of this
Act was to protect the farmers because during those days there was
oversupply of sugarcane. Besides, government was the major buyer of
sugar and sugar-rationing system was in force. As against this, now
sugarcane is in short supply. Therefore, the mills must be given the
liberty to fix the commencement date for sugarcane crushing as well as
the length of season. On top of this, the government is no longer the
Many years ago the government decided to follow
market-based policies. Following this, it also stopped fixing minimum
price of cotton. However, the same principle is not being followed in
case of sugarcane. While the government has been constantly increasing
minimum sugarcane price, it has also been forfeiting the right of mills
to adjust price of sugar proportionately. The result is that most of the
mills have become sick (financially). There are unable to make timely
payment to the growers. Since most of the mills are either posting
losses or making marginal profit, the shareholders are also not getting
any return on their investment.
Yet another irony is that sugarcane price is not
uniform for all the three provinces. Interestingly, sugarcane price has
always been higher in Sindh. On top of this mills also have to pay
'quality premium'. It was said in the past that since recovery was low
in Punjab as compared to Sindh, sugarcane price has to be lower.
However, the situation changed completely because in certain areas of
Punjab recovery is even higher than the benchmark fixed for payment of
quality premium in Sindh. It may be a little difficult to believe that
while Punjab government decided to bring down sugarcane support price
for the current season, Sindh government announced an increase.
It is often said, "The present regime believes
in consultation with all the stakeholders. However, it seems that the
mills, the largest stakeholders, are not being consulted at the time of
formation of any policy. The government considers itself the largest
stakeholder and also the custodian of rights of farmers. However, no one
realizes that if mills do not operate, who will buy the sugarcane? This
in no way implies that the interest of mills should be upheld against
farmers. The bottom line is, prosperity of growers is dependent on the
efficient performance of the mills."
However, another analyst says the situation reminds
an old saying, 'Too many hands spoil the curry'. This is the crux of the
matter. At least a dozen federal and provincial ministries and
departments have to be consulted before making any decision.
Interestingly, the objectives of various ministries often become
conflicting and the ultimate result is either 'who cares' or 'least
bothered' attitude. The ultimate result is that all the key stakeholders
continue to suffer, the worst hit being the consumers.
Lately, it is being said that linking of sugar price
with sugarcane price will solve all the existing problems of the
industry. It is a totally incorrect impression being portrayed by people
having vested interest. First of all, there is no need to fix sugarcane
support price. Let the market forces fix the price. Second, any increase
in sugarcane price creates a justification for a corresponding rise in
sugar price. Is it not a fact that the price of locally produced sugar
is too high as compared to its price in other sugar producing countries?
Why should they be forced to pay for the inefficiency of sugarcane
growers and the millers?