Khandsari Industry Seeks Support Amidst Export Restrictions Debate

Producers in the Khandsari sugar industry are rallying for government support to counter calls for export restrictions made by the Indian Sugar and Bio-Energy Manufacturers Association (ISMA). The Bhartiya Heritage Association of Khandsari and Traditional Sweeteners Industry (Bhakti) is advocating on behalf of Khandsari producers, emphasizing the industry’s importance to small sugarcane farmers in Uttar Pradesh and Maharashtra.

Key Developments

1. Advocacy for Export Continuity: Bhakti aims to meet with DGFT officials and UP Chief Minister Yogi Adityanath to defend the export potential of Khandsari sugar. According to Bhakti’s director, Khandsari producers offer immediate cash flow to farmers, often at rates higher than the government’s Fair and Remunerative Price (FRP), thus supporting small farmers more effectively than larger mills.
2. ISMA’s Push for Restrictions: ISMA recently requested the DGFT to impose restrictions on Khandsari exports, arguing it disrupts the sugar milling industry by creating a cane supply shortage. ISMA’s letter highlights the growing capacity of Khandsari units, particularly in UP and Maharashtra, and claims the sector’s expansion threatens larger mills’ profitability and operations.
3. Industry Dispute: Bhakti points out that ISMA exported around 5 lakh tonnes in 2023–24 while opposing Khandsari’s smaller exports, a position Bhakti argues is contradictory. Khandsari units, which use under 1% of sugarcane output compared to mills’ 75%, argue for an exemption due to their relatively minimal impact on national cane supplies.
4. Farmers’ Concerns: Bhakti emphasizes that Khandsari units are vital for small farmers’ livelihoods, offering immediate payments that mills cannot always provide. This support is crucial in states with large numbers of Khandsari units like UP’s 270–280 units and Maharashtra’s smaller network of 10–15 units.

The outcome of Bhakti’s appeals could shape the future of the Khandsari industry and its role in supporting farmers amidst shifting policies in the sugar sector.

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