The Union government has withdrawn the draft Sugarcane (Control) Order, 2026, following feedback and suggestions received from state governments and industry stakeholders.
“The draft order, which was released on April 20 for public consultation, sought to replace and revise the existing Sugarcane (Control) Order, 1966. The order stands withdrawn,” an office memorandum issued by the Department of Food and Public Distribution on Friday said.
What is the controversial order
The draft Sugarcane (Control) Order, 2026 is a legal framework issued by the government under the Essential Commodities Act, 1955, to regulate the production, pricing, distribution, and storage of sugar. It supersedes previous 1966 and 2018 orders to align with modern technology, ethanol integration, and changing industry dynamics.
The ordergrants the central government the power to determine the Minimum Selling Price (MSP) of sugar to maintain domestic market stability. It mandates strict release quotas for sugar sales, movement, exports, and imports. It also requires manufacturers to obtain licenses.
The orderalso sought to bring raw sugar and larger Khandsari sugar units directly under the central regulatory umbrella.
Why was the order withdrawn
One of the main provisions of the draft order that has been a cause of consternation among farmer groups was the one that sought to regulate the gur and khandsari units by making licences mandatory for them, and making payment of Fair and Remunerative Price (FRP) to farmers compulsory.
The government also received a lot of flak for the proposal to increase the minimum distance criterion between sugar mills from 15 km to 25 km. Other provisions aimed at updating regulations governing sugarcane procurement and processing in line with evolving industry requirements.
The withdrawal means the proposed order will undergo further review before any revised version is brought forward. The government has not indicated a timeline for issuing a fresh draft.
What are the farmers’ take on the order
The farmer groups had said that the draft provisions not only sought to regulate the unorganised ‘gur’ and ‘khandsari’ units but also contain some punitive provisions that could be detrimental to both sugarcane farmers and the khandsari industry.
The Bharatiya Kisan Union (Apolitical) said one of the main defects in the draft is the definition of crushers. It argued that all crushers and traditional ‘kolhus’ should be brought under a single category, as modern kolhus now use advanced rollers comparable to or larger than those used in khandsari units.
Critics argued that the proposed changes could strengthen the monopoly of sugar mills in sugarcane-growing regions while making it difficult for jaggery, khandsari and crusher units, which play an important role in the rural economy, to operate viably. Farmer groups and khandsari industry representatives had consistently opposed the draft, warning that it could adversely affect competition and farmers’ interests.
NDA partner Rashtriya Lok Dal president and MoS Jayant Chaudhary had held discussions with representatives of the farming community regarding the proposed changes.
What is the road ahead
The withdrawal of the draft order is being viewed as a significant policy reversal. With assembly elections scheduled in Uttar Pradesh in 2027, the government’s decision is likely to ease concerns among sugarcane farmers in one of the country’s largest cane-producing states and avert a potentially contentious political issue.
