Incentives offered Millers are not happy with the tax sops saying the incentive only translates to Rs 6 per quintal reduction in sugarcane rate compared to requirement of Rs 55 per quintal subsidy to run their factories The incentives announced today come with the caveat that the price of Rs 280 per quintal to be paid to farmers was not negotiable ISMA says cane arrears would reach Rs 15,000 cr by March-April if the millers are forced to pay Rs 280/quintal

New Delhi, November 28
The impasse over cane prices between the Uttar Pradesh Government and sugar mills continued with the Indian Sugar Mills Association (ISMA) declining the state’s offer to set up a high-level panel to look into linking cane and sugar prices.

According to ISMA Director-General Abhinash Varma, about 76 of 99 private sugar mills had already given suspension notices to the state government and there was no need for a state-operated panel considering that the Centre’s high-level Rangarajan Panel had already given its recommendations on the issue. “Please implement Rangarajan committee’s recommendations on linking sugar cane prices to sugar prices and get out of the politics of the fixing sgarcane prices,” he said

Varma said no further high-level committee was required considering that PMEAC Chief C Rangarajan had already given a formula for determining the sugarcane price. If its recommendations are accepted the matter could be resolved immediately, he said, adding the sugar mills were not in a position to pay more than Rs 225 per quintal, Rs 55 less than the state-advised price of Rs 280. If the sugar prices increase, the mills will be in a position to pay more, he added.

Meanwhile, assuring the Centre’s full assistance in solving the UP sugar crisis, Food Minister KV Thomas asked sugar mills and farmers not to “precipitate” the crisis. He also asked the UP Government to settle the issues with sugar industry at the earliest so that mills start crushing operations in the current season that started from October. The informal group of ministers, headed by Agriculture Minister Sharad Pawar, would take a decision on all sugar-related issues, including financial package.

According to Varma, arrears could increase to Rs 15,000 crore by March if the current pattern of pricing was followed. Besides, banks were refusing working capital loans because of the weak financial position of the mills. Even though UP government also offered to waive entry tax which would help sugar mills save around Rs 220 crore and also offered a subsidised interest scheme which would help sugar mills save Rs 190 crore sugar mills to avoid losses, Varma maintained that the UP mills could not afford to pay anymore than Rs 225 per quintal, which was still more than the FRP of Rs 210 per quintal.

Cash-starved UP private millers have decided not to start operation in 2013-14 marketing year (October-September) saying they were not in a position to pay more than Rs 225 per quintal to farmers as against the state advised price (SAP) of Rs 280 a quintal announced by State. While Thomas said out of 122 mills in UP, 50 mills had started, Varma said 17 cooperative and four private mills had started crushing. As many as 76 private sugar mills have shut crushing operations. On Wednesday, crucial talks between UP government and mill owners to break the logjam over cane crushing operations failed.

Mumbai, November 28
Maharashtra's politicians who control most of the state's sugar co-operatives want the Central Government to allow export of the sweetener in addition to a subsidy of Rs 500 per quintal.

A delegation of state politicians from both the ruling and opposition parties met Prime Minister Manmohan Singh earlier this week and sought his intervention, according to sources here.

"Maharashtra has surplus sugar amounting to 24 million tonnes and more cane will be crushed this year," says an official of the state sugar federation. According to the trade, there is a surplus of 94 million tonnes of sugar across India.

However, sugar output in the country is likely to be lower this year as sugar mills in Uttar Pradesh, India's largest sugar producer, have suspended operations in order to obtain higher prices from the state government. Sugar mills in Maharashtra have already begun crushing cane. As of now, sugar mills have agreed to pay just Rs 2,400 per tonne of sugar cane. Farmers' organisations are demanding that they be paid at least Rs 3,000 per tonne.

Political leaders in charge of sugar co-operatives are already demanding that the Central Government make it mandatory for oil companies to increase the blend of ethanol in petrol from 5 to 10%.

Other concessions being demanded include restructuring of loans and interest-free loans to sugar mills.

Meanwhile, sugarcane farmers in Maharashtra have threatened to stop crushing of cane if the minimum support for cane is not raised to Rs 3,000 per tonne. 

New Delhi, November 28
The general insurance industry is expected to grow at a lower rate of 15% in financial year 2014 owing to the continued slowdown in economic activity.

In contrast, over the past five years, the gross premium written by the general insurance industry has grown at a compounded annual growth of 18.1% in FY13, with slowdown visible since FY12 in line with economic activity trends.

Karthik Srinivasan, senior VP, ICRA Ltd, said, “There is a high co-relation between the premium volumes of the general insurance industry and the national GDP growth rates. The recent slowdown in the economic activity has impacted the volumes”.

As per study the private sector players have maintained a higher growth rate compared to their PSU peers and have seen a gradual increase in their market share to 47% in the first half of the year. “We expect the trend to continue going forward with our forecast of relatively higher growth for private sector players”, it said.

Motor is largest segment with a share of 46% but growth is expected to moderate in line with decline in growth in automobile industry. Health segment with a share of 26% is expected to maintain a steady growth. Fire and engineering with a share of 14% is expected to be impacted directly by slowdown in economy with the postponement of capital expenditure and new infrastructure projects.

New Delhi, November 28
British motorcycle brand Triumph today entered the Indian market with 10 models, priced between Rs 5.7 lakh and Rs 20 lakh (ex-showroom Delhi).

New York, November 28
The price of oil was heading down toward $ 92 a barrel today, near six-month lows, after US crude stockpiles rose for a tenth consecutive week.

By early afternoon in Europe, benchmark US crude for January delivery was down 16 cents at $92.14 a barrel in electronic trading on the New York Mercantile Exchange, having dropped $1.38 yesterday. Floor trading on the Nymex was closed Thursday for the Thanksgiving holiday, resulting in low trading volumes. — AP

New Delhi, November 28
The Pollution Control Board (PCB) of Odisha has directed Bhushan Steel not to operate the second blast furnace at its Meramandali plant in Dhenkanal district till further notice.

"...the company has further received a direction of closure from the state PCB for not starting the operations of Blast Furnace No. 2 again, trial run of which started recently on November 10, 2013, till further direction...," Bhushan Steel said.

PCB's missive comes following an explosion on November 13 that took place at the the slag pit during the trial run of the Blast Furnace No. 2. On the basis of an inspection report of a four-member team of the Factory and Boiler Directorate, the district administration had earlier sealed the new blast furnace area of the steel plant.

"... company's existing operational units of the steel plant at Meramandali, Odisha viz, conarc furnace, arc furnace, DRI kilns, blast furnace No. 1, coke oven, slab caster, HR mill, etc. are fully operational as earlier," Bhushan Steel said. — PTI

New Delhi, November 28
The government has decided to reduce the threshold limit of mandatory e-payment from Rs 10 lakh to Rs 1 lakh for both central excise and service tax payment with effect from January 1.

Now, a service tax payer who has paid a duty or tax of more than Rs 1 lakh in the previous financial year shall be required to pay duty or tax through Internet banking. — TNS

BRIEFLY

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HUDCO to raise Rs 2,439 cr via tax-free bonds
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ZTE targets revenue of $800 m from India
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Banks, infra need Rs 10.4 lakh cr bond funding:Crisil
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