Karnataka HC declines to stay higher price for sugarcane growers in setback to mills

The Karnataka High Court has declined to halt a new notification that sets a higher sugarcane price. This price is above the central government's Fair and Remunerative Price for the upcoming season. Sugar mills had argued they could not afford even the FRP. The court noted the industry's profitability from sugar and ethanol production.

The Karnataka High Court on Tuesday refused to stay a November 8 notification fixing a higher sugarcane price, over and above the fair and remunerative Price (FRP) fixed by the union government for the 2025-2026 sugarcane season.

The South Indian Sugar Mills Association (Karnataka) and others moved the court with the plea that the industry was in a bad shape that they were not even able to pay the FRP on time. The Association said the government has not followed any statute while exercising its power to fix the price.

Justice Suraj Govindraj, however, declined to give interim stay without first hearing the respondents (govt, farmers) while observing that the sugar industries made money by producing sugar and ethanol, and by diverting ethanol to other industries but were reluctant to share a part of it with sugarcane growers.

The judge posted the case for further hearing on December 17.

The Association prayed for quashing the government notification on the grounds that the State has no power to announce higher prices over the one fixed by the Centre.

Chief minister Siddaramaiah, last month, announced that sugar factories and the government would each pay Rs 50 per tonne of sugarcane in addition to the existing purchase price to farmers.

There are 81 sugar mills in Karnataka. These include one run by the government and 11 in the cooperative sector. The rest are privately owned.

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Source: EconomicTimes
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