India's top sugar producing state considers export subsidy: sources

Mumbai: India's biggest sugar producing state, Maharashtra, is considering paying mills a subsidy of 1,000 rupees ($16) per tonne to help them clear stocks, a government source and a trade source told Reuters on Tuesday.

The state cabinet is likely to approve the incentive in a week, said the government source who declined to be named.

Maharashtra accounts for most of the raw sugar produced in India, the world's second-biggest producer and largest consumer.

The federal government last week decided to give mills a subsidy of 4,000 rupees a tonne for exports of up to 1.4 million tonnes of raw sugar, an incentive some traders said may be too little as global prices remain weak with large supplies from top producer Brazil set to flood the market soon.