The price that the Indian sugar farmer gets is set by the central government or sometimes by the state govts. The govts may have atendency to play political football with this and increase the price, regardless of a falling sugar price. The mills are caught in a cleft stick. ie they are reluctant payers and the govts may step in with cheap loans. The sugar industry looks like a mess. This problem worsened in 2006/2007 and there may be lessons learnt.
