Thursday, 30 June 2022

FRP

 Fair & Remunerative Price (FRP) is the minimum price that is to be paid by the sugar mills to the sugar farmers. The sugar mills are legally bound to pay FRP to the farmer for cane production. Mills have the option to sign an agreement that allow them to pay FRP in installment. Delay in payment attract up to 15% of interest per annum & the sugar commissioner can recover unpaid FRP as due revenue recovery by attaching properties of the mills. The FRP across the country governed under the sugar control act, 1966 issued under Essential Commodities act, 1955 which mandate the payment within 14 days of the date of delivery of the cane. FRP is determined on the recommendation of the Commission for Agricultural Costs & Prices (CACP) & announced by the Cabinet Committee on Economic Affair (CCEA). The FRP is based on the Rangarajan committee report on recognizing the sugar industries. 

Recently Maharashtra Government has introduced FRP in the state that allow sugar mills to pay Fair & Remunerative Price in 2 trenches. The first installment would have paid within 14 days of delivery cane & second installment within 15 days of the closure of the mills. 

The farmers in Maharashtra are not satisfied with the state government decision regarding FRP and they started protesting against the FRP. The farmer concerned with FRP is that it will impact their income as FRP paid in installment & will depend on an unknown variable. This will impact on their liabilities to bank loan & other expenses as they are to be paid as usual. The farmers required more money in the beginning of the season as it will decide the next crop cycle. 

The FRP is fixed at Rs 2900 per tonne at a base recovery of 10% for the sugar season 2021-2022. The Maharashtra government take a great step for the farmers welfare but state government need to keep in mind that it will cause trouble to the farmer at certain scale. The government should reconsider the policy and frame it accordingly in order to avoid such losses like farmer mentioned in their commentary. 

The farmers are already aggrieved by the farmers bill that was introduced by the parliament. The FRP is another issue that haunt the farmers especially sugar cane farmer. Sugar cane is a cash crop that is grown hot & humid climate around 75 to 100 cm rainfall. The top sugarcane producing states in India are Uttar Pradesh (UP), Maharashtra, Karnataka, Tamil Nadu & Bihar. The sugar cane farming required manual labour from sowing to harvesting that required hard labour and human resources with less use of machines in the land. India is the 2nd largest producer of Sugar Cane after Brazil. 


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