UP's cane crisis shows how bad economics makes for bad politics

With over four million cane farmers, it is not surprising that successive governments in Uttar Pradesh have chosen to fix the price at which sugar mills buy cane (state advised price, SAP) at well above what the Central government's Commission for Agricultural Costs and Prices (CACP) thinks is a fair and remunerative price (FRP), based on the value of what the cane fetches after processing and the costs involved in this.

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