Indian Sugar Industry
The Indian sugar industry is a key driver of rural development, successfully contributing to the inclusive growth. It supports over 50 million farmers and their families and delivers value addition to their farm produce. It is the second largest agro-based industry in India.

The Indian sugar industry is characterized by the coexistence of private, cooperative and public sector. Production is concentrated in UP (North), Maharashtra (West) and the three southern States of Tamil Nadu, Karnataka and Andhra Pradesh. It has tremendous transformational opportunities to meet food, fuel and power needs of the country.

India is the second largest sugar producing country after Brazil. It is also the largest sugar consumer in the world. Cyclic changes in sugar production in India considerably impact world trade in sugar.

Sugar Production Cycle:

Low production period: 3-4 years

Higher production: 2-3 years

Sugar industry is politically sensitive with Government keen to control both its input and output prices. Sugar has an unduly high weightage in WPI. A recent study by the Madras School of Economics reveals the relevant lower share of expenditure on sugar within a basket of consumption and consequent need to down revise its weightage.

Government’s concern to control sugar price would also appear misplaced. Independent study by KPMG incorporating AC Neilsen’s Survey report demonstrably brings out the fact that 75% of sugar is consumed only by industrial, business and high income household segments. Even for the remaining 25% consumer, sugar forms only an insignificant monthly budget.

Sugar industry has branched into by-product value addition through cogeneration of power and production of ethanol for blending with petrol. It plays a pivotal role in the core sector of the economy to achieve broad based and well distributed wealth creation.