The results of India’s elections, held between April 11 and May 19 this year, are likely to be announced today. If, as some pollsters and analysts have projected, Prime Minister Narendra Modi and his Hindu nationalist Bharatiya Janata Party (BJP) win again, questions arise as to whether he will be able to make good on the promises he made regarding the sugar industry, particularly in the populous Uttar Pradesh, a known BJP stronghold.
India is a huge sugar-producing country, possibly the largest in the world by tonnage along with Brazil. According to statistics from its trade bureau, India has 510 sugar mills and was projected to produce 30,700,000 tonnes of sugar this year. A voracious consumer of sugar, India uses about 40 percent of what it produces annually and should be able to sell the rest and make a tidy profit, but it can’t because its cost of production is way above the international market price for sugar. According to the Hecht Commodity Report, as at September last year, the price for sugar was 9.83 (US) cents per pound, its lowest price since 2008 and currently stands at around 11.55 (US) cents per pound. As a result, millions of tonnes of sugar are stockpiled in India’s factories and independent growers – numbering some 50 million poor farmers – who sell their cane to the mills are owed billions of dollars, which the factories are simply unable to pay. This is because, outside of being unable to make a profit on the international market, millers have to sell a significant quantity of their sugar in India at a price set by the government, which is 15 percent below the cost of production.
Yet, in his campaign speeches around the country and particularly in his stronghold, Mr Modi promised to ensure that farmers were paid every penny owed to them. Of course, he can’t. The one reason the mills have not all collapsed into bankruptcy as yet is because the government has been using state funds to bail them out; just as it has been arranging for crop loans to keep unpaid farmers planting.
If any of this sounds familiar, it is because in India, like in Guyana, cane sugar is a highly politicised product. For years, it has been less about the economic viability of the product and more about politicians using charm and money to earn over 75 million votes in the case of India or 75,000 in the case of Guyana. The sugar high, sugar low is a vicious cycle that keeps spinning. Farmers, millers, workers and their families are ‘sweetened’ by the honeyed, insincere promises of politicians just enough to keep them employed with doing the same thing day after day and year after year and hoping for a different result.
Sugar is addictive and so is the idea that anyone will actually be able to live a comfortable life by being part of the process of unmechanized sugar production. This is the age of technology and the time for that has long expired, no matter how many politicians continue feeding it to the masses like so much Kool Aid.
Beet sugar, honey, Stevia, agave nectar, maple syrup and high fructose corn syrup are among the substitutes or options that have long blighted the prospects of cane sugar ever regaining the kingly status it held for over 200 years, from the 1770s until the 1980s. Newer, healthier alternatives, like coconut sugar and Nucane for example, are being discovered every day.
Tate and Lyle, a former major global cane sugar refinery based in the United Kingdom, and which had in the past stirred the sugar pot in Guyana more than once, began to diversify since during the 1970s into producing beverages, soups, sauces, dressings and confectionaries among other food items as well as animal feed. It subsequently entirely divested itself of its sugar refineries and switched its business to producing alternatives like the artificial sweetener sucralose known by its brand name Splenda. It has partnered with the producers of Stevia, a plant-based sweetener and is also now producing another sweetener, allulose, from corn.
If Tate and Lyle, which has been in the sweetener business for over 150 years, felt it was financially prudent to move away from refining cane sugar, then surely politicians who keep pushing for its continuance as an industry are merely serving their own ends. It is unfortunate too that they often appeal to the baser sides of their constituents using arguments founded on mere lies.
That being said, if predictions hold true and Mr Modi wins another term in office, the world will be watching to see if and how he turns the fortunes of poor cane farmers and factory workers around. His first sweep at the polls had led to the coining of the term ‘Modi Magic’ and that is truly what he will need to do what he promised. Other cane-sugar producing nations should take note.
