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Sugar export subsidy
Why is it in the news?
- The Cabinet Committee on Economic Affairs (CCEA) has approved sugar export policy for evacuation of surplus stocks during sugar season 2019-20.
- The move came after the record sugar production continuing to drive down prices and the cane farmers face huge arrears in payment.
More in the news
- The Centre has decided to offer a ₹10.45 per kg subsidy to incentivise mills to export their surplus stocks.
- The export subsidy package will cost the exchequer ₹6,268 crore.
- The subsidy package will facilitate the export of up to 60 lakh tonnes in the 2019-20 marketing season, which begins in October.
- It will benefit millions of farmers in U.P., Maharashtra and Karnataka, as well as other states.
Lower price at Global Market:
- Global sugar prices are more than Rs 10/kg lower than domestic prices.
- Hence, the government subsidy to sweeten the deal and persuade mills to export their surplus.
- The lump sum export subsidy will be provided for expenses on marketing costs including handling, upgrading and other processing costs, costs of international and internal transport and freight charges.
Source
The Hindu.