India is the largest producer of sugarcane. Placing sugar khandsari and gur or jaggery together, India stands first in the world production. In 1950-51 there were 138 sugar mills in the country. Their number has now escalated to 460. Since it deals with a consumable raw material, it is extensively scattered and is fundamentally a rural-based industry. The production of sugar has also risen gradually, though with ample fluctuations- from 1.13 million tonnes to 12.8 million tonnes by 1997-98. In 1998-99 sugar production had surpassed the 15 million tonne mark. In 1996 it was 13 million tonnes. But at the same time, its take-off in the domestic market has climbed further.

The industry still follows the dual-pricing system and compulsory levy to the public distribution sector. However, the line between the two sets of prices is now pretty low.

The industry had commenced in the private sector and was mostly limited to Uttar Pradesh and Bihar. Now it is reasonably extensive. As many as 256 mills are within the cooperative sector. The pockets of sugar industry are well irrigated and have also become pockets of rural opulence to a certain degree. It is a seasonal industry and as such is befitted with the co-operative sector. The sugar content in cane is higher i.e. about 10.5% in Maharashtra and other southern states. The industry therefore has been amplifying speedily in these parts.