Sugar pricing dispute

Published December 14, 2014

IT has been more than two months now that a dispute over the minimum support price of sugarcane has been simmering in Sindh. To this day, most mills in the province have not fired up their boilers or begun the procurement of sugarcane.

This is one of the longest delays to the start of the cane-crushing season in recent memory. Despite two orders from the Sindh High Court ordering the millers to start cane-crushing, as the law requires them to do, the only thing being crushed today is the provincial government’s resolve to exercise its executive powers. After putting pressure on the mills for more than a month to begin the crushing season, the Sindh government surrendered to their demand and notified a minimum support price of Rs155 on Dec 4.

The notification caused an uproar among growers in the provincial assembly, and days later the provincial government again surrendered and notified a price of Rs182 instead. Now the millers are up in arms, saying they were deceived, calling the revision illegal, and threatening to shut down their operations if the notification is not withdrawn. Clearly, a powerful tug of war is taking place within the Sindh government, since in Punjab the price has been set at Rs180 by the provincial government and crushing has been under way smoothly for weeks now. The Sindh government finds itself caught on both sides of an agricultural price dispute because each side of the equation has powerful representation within the party. Caught between both interests, the only loser is the small grower who cannot wait for very long to sell his crop, as well as the consumer who will bear the ultimate cost of this dithering by the Sindh government. The provincial government must move fast to break this deadlock, taking care to preserve the interests of growers and consumers first. Otherwise, it should simply admit that it is incapable of exercising the executive powers handed to it by the 18th Amendment. 

Published in Dawn December 14th , 2014

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