India Intelligence Report
 

Sugar Farming Increases for Quick Profit

 

More and more Indian farmers are switching from traditional crops of vegetables, pulses, and cereals to sugarcane because of the quick profit they can make from this cash crop. Simultaneously, strong domestic demand and booming export markets to neighboring sugar-deficit countries are factors encouraging this conversion causing sugar production to be 21-22 million tons by September 2007. Neighboring countries such as Sri Lanka, Pakistan, Bangladesh, Indonesia, and West Asia require 5-6 million tons of imported sugar every year. 

An elated Indian Sugar Mills Association Director S. L. Jain boasts “cane is taking over in a big way and people are uprooting vegetables and planting canes in their backyards.”  He insists, “Cane is the one of the most profitable options our farmers have today.”

While this may be great for his purpose and the Sugar Mills, the question is where this greed is taking the country. Farmers in water-starved areas have switched to cane because it is quick money. Governments help by giving them free power and farmers have indiscriminately taken out ground water rendering most areas barren. In Andhra Pradesh, representing probably the most inefficient Government in the South India, populist schemes of free power by Chief Minister Y.S. R. Reddy have depleted all ground water because of the greed that Jain effuses. Thus, the country’s sugar production has grown unnaturally from 13 million tons a year ago to 18.5 million tons in 2006. The 450 sugar mills have paid more than the Government rate encouraging more sugarcane production. 

 

Good business is not just about booking profits today but whether such profits are sustainable from a long-term view. The increased demand on water, unsuitability of this crop to drought areas, over exploitation of groundwater resources, increased fertilizer usage and resultant runoffs are seriously affecting sustainability of agriculture and the environment in many areas.