Subsidy in agriculture is an important issue and is an instrument of fiscal policy of the government. The developed countries are providing huge amount of subsidy to agriculture whereas the developing countries are restricted in many ways particularly under WTO regulation. In 2001 the government of Bangladesh again decided to provide subsidy on agriculture including sugarcane after the withdrawal of subsidy in1992. Sugar industry is the most important agro-based industry in Bangladesh. This industry is passing its crisis period due to huge amount of losses every year. Poor sugarcane...