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India’s top sugar producing state raises cane price by 7.9%

NEW DELHI, Sept 26 (Reuters) – India’s biggest sugar producing state, Uttar Pradesh, has raised the price mills must pay for the new crop by 7.9%, the top official said, announcing the first hike in the cane price in four years ahead of state assembly elections next year.

The state government has decided to raise the price that mills need to pay cane growers in the 2021-22 season beginning October to 340 rupees per 100 kgs ($4.61 per 220 lb), Uttar Pradesh Chief Minister Yogi Adityanath said, addressing a group of farmers.

After raising the cane prices by 3.3% to 315 rupees per 100 kgs in the 2017-2018 season, Uttar Pradesh kept the rate unchanged, stoking anger among millions of farmers, an influential voting bloc.

The election in Uttar Pradesh, which sends 80 lawmakers – or more than any other state – to parliament in New Delhi, is often seen as a barometer of the popularity of the federal government.

Prime Minister Narendra Modi’s ruling Bharatiya Janata Party (BJP) is expected to pull out all the stops to hold on to the state, which has a population of 240 million.

The government on Sunday raised the cane price by only 25 rupees per 100 kgs, the first increase in four years during which the cost of cultivation has surged as prices of diesel, power, labour, insecticide, and pesticides have risen sharply, said Sudhir Panwar, a farm policy expert from Uttar Pradesh.

For 10 months, tens of thousands of farmers have camped on major highways to the capital, New Delhi, to oppose new farm laws, in the longest-running growers’ protest against Modi’s government.

In another move to placate angry farmers, Uttar Pradesh last month decided to drop legal proceedings against farmers accused of burning crop waste, a major source of pollution.

($1 = 73.8130 Indian rupees)

(Reporting by Mayank Bhardwaj; Editing by Emelia Sithole-Matarise)

((mayank.bhardwaj@thomsonreuters.com; +91-11-4954 8030; Twitter: @MayankBhardwaj9; Reuters Messaging: mayank.bhardwaj.thomsonreuters.com@reuters.net))

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