News Capsule: Dispute Over FRP and Licensing Rules: Centre Withdraws Draft Sugarcane Control Order
30-May-2026 09:34 AM
News Capsule: Dispute Over FRP and Licensing Rules: Centre Withdraws Draft Sugarcane Control Order
★ The Central government has withdrawn the proposed amendments to the Sugarcane Control Order, 1966, following strong opposition from farmers, the gur and khandsari industry, and sections of the sugar sector.
★ The government said the draft would be reconsidered based on feedback received from state governments and other stakeholders.
★ The proposed amendments sought to make licensing mandatory for gur and khandsari units and required them to pay farmers the Fair and Remunerative Price (FRP) for sugarcane.
★ Farmers and industry representatives argued that the provisions would adversely affect small producers and traditional cane-crushing units.
★ Farmer organizations also demanded that sugarcane pricing should not be based solely on sugar recovery. They urged the government to include revenue generated from ethanol, molasses, bagasse, compressed biogas, and other by-products while determining cane prices.
★ The strongest opposition came from major sugarcane-growing districts of western Uttar Pradesh, where gur and khandsari production is a key part of the rural economy.
★ With the Uttar Pradesh Assembly elections scheduled for 2027, the government appears to have opted against pushing ahead with a contentious reform.
★ The draft amendments had also proposed increasing the minimum distance between two sugar mills from 15 km to 25 km.
★ The withdrawal means no immediate new regulations will be imposed on gur and khandsari units, allowing alternative sugarcane procurement channels to continue operating as before. The move is likely to provide relief to farmers and support sentiment in the sugarcane market, particularly in western Uttar Pradesh.