3.4 Problems and Challenges of Sugarcane Farmers

Background technical knowledge on farming and lack ue to the geography, soil qual- of consultation mechanisms, agricultural Dity, irrigation accessibility, loans, lack of access in policy re/forma- and favorable weather, the lower Terai tion agendas and process, untimely and region is the hub for Nepal’s agricultur- irregular payments from the sugar mills, al production. The production of various difficulties in receiving governmental cash and food crops in the region, is also subsidy on time, and inability to increase Nepal’s agricultural backbone. sugarcane yield. According to the Prospect and The sugarcane farmers from the Challanges of Sugarcane Development plains have organized two protests in in Nepal: Production, Market and Policy Kathmandu within a year and the main (Amita Pandey and Sudip Devkota-2020) demand was that they be paid the money Nepali sugarcane production contributes that sugar mills owed them. The farm- less than one percent to the production of ers had organized the protest in Decem- SAARC countries, and Nepal ranks 41st ber 2019 and returned after assurance of among the sugar producing countries in payment by the government. The farm- the world. Sugarcane is a major cash crop ers then postponed the protest after the in Nepal and it contributes 2.1 percent of sugar mill owners also assured them that the Agriculture Gross Domestic Product they would be paid. The payments out- (AGDP). Despite its position in relation standing in December 2019 added up to to the hectare it covers, Nepal lies in the NRs. 1.40 billion and following some pay- 41st position among others in terms of ments had come down to NRs. 650 million the volume of production. Nepal produces in December 2020. Some banks had also 0.16 percent of the total sugarcane in the issued notice of auction of collateral land world. that the farmers had provided for loans Proper care to the sugarcane crop after they were not repaid. This article can lead to good harvests for at least three discusses sugarcane cultivation and the years after plantation and this can result issues faced by farmers in Kapilvastu and in sizeable earning for farmers. Further, Nawalparasi (West) districts, which are sugarcane can be grown also on land not similar to those faced by sugarcane grow- suited for other crops, which is also ad- ers across Nepal. vantageous to people with lands not good Agriculture is the main source of for other crops. Sugarcane farming is done household income in West Nawalparasi in 15 districts of Nepal’s Terai (plains). and Kapilbastu districts of Lumbini Prov- Some of the major problems faced ince. According to the statistics of Food by Nepal’s sugarcane farmers are lack of and Agriculture Organization Corporate

82 Problems and Challenges of Sugarcane Farmers 2018, sugarcane is grown on 71,466 hect- Research Methods ares of land in Nepal and the production The study used a number of tools to is about 3.23 million tons of sugarcane collect information for this report. These each year, making it a major cash crop.1 included field observations, interviews, In West Nawalparasi, sugarcane is grown consultations with farmers, review of in about 5,100 hectares of the total 25,955 relevant reports, including relevant laws hectares of cultivatable land in the dis- and agreements and reports published in trict. In Kapilbastu District about 4,000 the media. farmers were engaged in sugarcane farm- The study was limited to five -ru ing. There are three sugar mills and 117 ral municipalities of Susta, Pratappur, crossers in district – Lumbini Sugar Mill, Sarawal, Palhinandan, and Ramgram of Indira Sugar Mill, and Bagmati Sugar West Nawalparasi; and Krishnanagar Mill. About 4000 farmers of Shivaraj Mu- Municipality and Shivaraj Municipality nicipality and Krishnanagar Municipal- as well as Bahadurganj of Krishnanagar, ity of Constituency No. 3 were involved in and Jawahari, Chanai, Shivapur and sugarcane production. Birpur of Krishnanagar Municipality in About five years ago, the Mahalax- Kapilvastu district. The study focused on mi Sugar Mill in the district purchased the problems faced by farmers who were cane from about 8,000 growers in about not paid for their product. The study’s re- 8,000-9,000 hectare of land. But after the spondents included owners of sugar mills, mill started periodic closure every year cane growers, as well as struggle commit- since 2015, the number of growers de- tees formed by farmers to demand pay- creased to 4000 and the area under culti- ment from mill owners. vation was also reduced to 1,400 hectares. The major problems faced by the sugar- Problems Faced by Cane Growers cane growers in the district were: West Nawalparasi is an area • Delayed payments by industries to known for its sugar cane production. the farmers It was grown in 5500 hectares of about • Lack of adequate agricultural work- 25,955 hectares of cultivable land. Until ers, and not long ago, about 7,000 hectares of land • Inability of the government to en- was used for growing sugarcane, but that sure that cane growers were paid for has decreased – perhaps – reflecting the cane on time. problems faced by the farmers. Generally, Nepal’s production and supply of sugar- Objectives cane is lower than the crushing capacity The objectives of this article are, of mills. The seasonal and lower supply • To identify problems faced by farm- of cane has led the sugar mills to oper- ers engaged in sugarcane farming, ate for a short crushing periods of around and four to seven months a year.2 According to • To understand the demand of farm- the District Committee of the sugarcane ers and the outstanding payments farmers, the main reason for the lower due to them. supply compared to demand by mills is the delayed or no payment to the farmers

1. https://www.researchgate.net/publication/342457317_Prospects_and_Challenges_of_Sugar- cane_Development_in_Nepal_Production_Market_and_Policy/link/5ef5489b299bf18816e80784/ download 2. https://www.researchgate.net/publication/342457317_Prospects_and_Challenges_of_Sugar- cane_Development_in_Nepal_Production_Market_and_Policy/link/5ef5489b299bf18816e80784/ download Nepal Human Rights Year Book 2021 83 from the sugar mills. This had led to other According to the District Administration problems such as not being able to repay Office, NRs. 49 million sent to the dis- loans taken from the banks, which then trict in 2018/19 (2076 BS) as subsidy had led to the banks auctioning the collateral. remained unspent in the account of the The farmers there were yet to re- District Office of the Financial Comptrol- ceive NRs. 183.4 million in outstanding ler. The District Sugarcane Production payment from the three sugar mills in the Organization members said this amount district. Umesh Kumar Yadav, Chairper- has remained at the office because of the son of District Sugarcane Producers’ Or- difficult legal procedure involved -in re ganization, said the outstanding amount ceiving payments. According to Umesh to farmers at the Sunwal Sugarcane Mill Kumar Yadav, the Chairperson of Dis- was NRs. 100 million, Indira Sugarcane trict Sugarcane Producers’ Organization, Mill NRs. 80 million, and Bagmati Sugar- even the government has been delaying cane Mill, NRs. 3.4 million. in providing the subsidy to the farmers. Binod Kalwar, a cane grower at The farmers had not received the subsidy Pratapapur-8 said he had promised his earmarked for payment in 2019. money lender an interest of five percent Likewise, in Kapilbastu, even each month but because he was unable to though sugarcane is a major produce and pay, the person has now begun growing there are sugar mills, crushers, and juice crops on his land. My payment has been makers who buy cane locally the farm- due for three years and now, the land (col- ers were deprived of getting good value lateral) could be auctioned. Another cane after the Mahalaxmi Sugar Mill shifted grower from Susta-5 said, “We were forced the factory. This mill itself had not paid to quit sugarcane farming and go for other farmers NRs. 70 million before it moved, crops because we have not received pay- and 8000 farmers there had not received ment for three years. Wherever we go, we the government subsidy of NRs. 25 per need to borrow money on interest, we are quintal of produce. This was supposed to afraid we have to face the same problems have been provided in 2015/16 (2071/72 with other crops also.” BS). The Lumbini Sugar Mill of Sun- The farmers said they had not re- wal owed NRs. 100 million to the farm- ceived payment for the sugarcane from ers. The mill was closed at the time of the mill owners since 2015. These farm- the study. Jorsingh Majhi, the Assistant ers from Nawalparasi, and Kapilbastu District Administrator, said that the mill and other parts of the country first came owners had been out of contact for about to Kathmandu to demand their payments 15 months. Durga Chaturvedi, Chief of in December 2019. Many feared that the the Sales Management Section of Indira banks could move in an auction the collat- Sugar Mills, said “Farmers are disap- eral to recover their loans and that would pointed because they have not been paid, leave them with nothing. our problem is the inability to sell sugar The protests in Kathmandu cul- in the market which is why we have not minated in an agreement between the been able to pay.” There are also some government and farmers on January 3, disputed payments. In the case of Indira 2020 that said the payments would be- Sugar Mill the farmers said it had not gin within January 21, 2020. Thereafter paid NRs.80 million, which the mill said the farmers postponed their protest. The was around NRs. 50 million. agreement was signed by Hareshyam The farmers who had not been Raya, Secretary of the protesting sug- paid the outstanding amounts faced ad- arcane growers, and Dinesh Bhattarai, ditional troubles because they had not re- Joint Secretary, Government of Nepal in ceived any subsidy from the government. the presence of the Minister for Industry,

84 Problems and Challenges of Sugarcane Farmers Commerce and Supply, Lekh Raj Bhatta. farmers had not yet received. In the agreement the parties had agreed The 2020 agreement with farm- that the ministry would coordinate for ers said that the government will provide ensuring the payments, form a task force NRs. 65.28 per quintal as the subsidy to resolve the problem, to undertake stud- amount. The Ministry of Home Affairs ies to make the subsidy effective and the agreed to draw the attention of the Min- farmers agreed to postpone their protest, istry of Agriculture and Livestock Devel- among others. opment and the Ministry of Finance re- The COVID-19 pandemic added to garding the issue. Similarly, the govern- the woes of the sugarcane farmers as they ment also designated the Department of could not even find work as wage -labor Commerce and Supply Management as ers. The non-payment by the sugar mills contact point for addressing the problem has even forced many to consider stopping regarding the payment to farmers and cane growing altogether, and some have mediate between the sugar mill owners already begun shifting to growing banan- and the farmers. After this, on December as and vegetables. 18, 2020, the government asked the farm- Al most a year after the agreement, ers to stop their protest. with government the farmers of Province 2 had not received payments for their pro- National and International Laws on duce, who gathered again in Kathmandu the Rights of Farmers and Laborers to press for the payments. This round of The definition (b) of Food Rights protests at Maitighar began on December and Food Sovereignty Act (1999) has de- 10, 2020. Their complaints were also the fined a “farmer” being a citizen engaged same – they had not received payments in agriculture as the major profession and since 2015 that had added up to NRs 1.2 lives entirely through the vocation. It also billion (mill owners said this was NRs 656 includes family member’s dependent of million) they also accused the mill owners that citizen or a person who is engaged of delaying payment because they could in agricultural activities for more than get away with it. Following a decision at six months or a citizen who is engaged in the Ministry of Home Affairs, on Decem- making agricultural tools and the family ber 15, 2020 the government issued an member of that citizen. order to District Administration Office to Likewise, in definition (c) of the arrest mill owners who had not paid the same Act has defined “agricultural land” farmers. as land for farming or land used for agri- Government of Nepal provides sub- cultural production or land allocated for sidies on chemical and organic fertilizers, agriculture in accordance with the exist- machinery, and insurance and also fixes ing laws. the purchase price of sugarcane. Despite According to the United Nations these facilities, the cost of sugarcane cul- Guiding Principles of Occupation and tivation is still on the high side in Nepal Human Rights (2011), state should be (NRs 469/quintal). More than half of the responsible for the respect, protection, cost of production goes to paying by labor. and maintenance of occupational human Other costs are that of chemical fertiliz- rights as they are provisioned. In the case ers, manure and land preparation.3 The of cane growers, it is evident that Govern- government agreed to provide “incentive ment of Nepal has not everything possible subsidy” for cane production, which the for protecting their rights. The Subsidy

3. https://www.researchgate.net/publication/342457317_Prospects_and_Challenges_of_Sugar- cane_Development_in_Nepal_Production_Market_and_Policy/link/5ef5489b299bf18816e80784/ download

Nepal Human Rights Year Book 2021 85 Providing Procedure to Sugarcane Farm- cane growing farming because of the de- ers (2018) and its amendment of 2019 lay or no payment by sugar mill owners. requires a sugarcane farmer to submit a The non-payment has deprived farmers document of evidence that clearly states of their economic and professional rights. the area of land under the crop along with Therefore the responsibility of the Gov- the evidence of the quantity of sale as ernment to ensure that all outstanding provisioned in Section 5 (9) (a). The sec- payments are made. Also important is as- tion 9 (b) of the same article says that the suring farmers of timely payments in the farmer who has used others land on lease future. has to submit the letter of contract that clearly mentions the plot number and Recommendations the area of land. In case the farmer can- The following recommendations not produce the documents as provisioned have emerged from the study. Firstly, it in above mentioned Article and sections, is important that the Government make section 9 (c) of the same article states that substantial efforts to ensure that the the farmer has to submit the recommen- outstanding payments to farmers are dation letter from the local level govern- cleared by mill owners. Similarly, the ment along with the evidence of plot num- Government should fix the price of - sug ber, area, and the quantity of production. arcane before the harvest and dispatch of The provision also says its account should the produce for processing. In the longer be maintained separately. term, it would be important for providing According to the Article 25 (1) re- technical advice and trainings to farmers lated to the Fundamental Rights in the to improve farming methods, alongside Constitution of Nepal (2015), every citi- support to increasing irrigation and mak- zen has the right to earn property, use ing available other inputs such as fertiliz- it, sell it, make profit from business, and ers, subsidies, and low-interest loans, on engage in transactions of other properties time. Support for increasing production under the existing laws. In the case of the by expanding irrigation and by providing cane growers there are complications in chemical and organic fertilizers in time the ability of farmers to enjoy the provi- are other considerations. In addition to sions in the Article above, in addition to the above, the Government should inves- being exploited by sugar mills. There are tigate the allegations against sugar mill also questions on the effectiveness of the owners and provide necessary redress to Government in assuring farmers their farmers. rights. References Conclusion • Bitter Experiences of Sweet Farming Nepal is still an agriculture-based Farmers, Published on Paush 1, 2077 country but the incomes of farmers have in INSEC online been decreasing despite the modern ways • Buddha Darpan, National Daily of farming. One reason is the lack of ad- • Different newspapers and magazines, equate knowledge about the new methods RSS and technologies. Sugar cane growing can • ekantipur.com become a good source of income for farm- • http://annapurnapost.com/news/140 ers if provided access to use technology 817 Barseni Thagidai Ukhu Krishak and fair market relation. The production (Farmers being exploited every year) of sugarcane in Nawalparasi alone could • https://myrepublica.nagariknetwork. contribute towards reducing sugar im- com/news/sugarcane-farming-done- ports. However, this has not happened; in-81-000-hectares-of-land-but-not- more and more people were moving from prospering/ 86 Problems and Challenges of Sugarcane Farmers • https://www.agriculturejournal.org/ • United Nations Guiding Principles volume7number2/dynamics-and-eco- for Occupational and Human Rights, nomic-analysis-of-sugarcane-produc- 2011 tion-in-eastern-plains-of-nepal/ • Working Procedure for Farmers’ • Lumbini Daily Grants, 2018 • Lumbini Darpan, Weekly • Amita Pandey and Sudip Devkota: • National daily, Mechi Kali Newspa- Prospects and Challenges of Sugar- per cane Development in Nepal: Produc- • Nepal Human Rights Book, 2020, P. tion, Market and Policy : retrieved from 70 https://thescipub.com/pdf/ajabssp. • The Constitution of Nepal, 2015 2020.98.106.pdf on January 27, 2021

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