Giving the background, the sources said, ECC in its decision of December 28, 2016 allowed export of 0.25 million tons of sugar. In subsequent decision on March 28, 2017, the ECC allowed an additional export of 0.2 million tons of sugar up to May 31, 2017 subject to the condition that "in case the committee constituted by the Prime Minister on November 25, 2015 would immediately recommend to the ECC for stoppage of further exports" and that the "exports will be completed within 60 days of allocation of quota or May 31, 2017 whichever comes earlier".
Pakistan Sugar Mills Association (PSMA) in its letter of May 6, 2017 approached the Ministry of Commerce stating that the sugar industry had produced a record quantity leading to a surplus of 1.475 million tons which was resulting in delayed payments to the sugarcane growers. The PSMA requested that a meeting of the Sugar Advisory Board (SAB) might be convened to review the overall availability and stock position of sugar allowing further exports. The meeting of SAB, held in the Ministry of Industries and Production on May 17, 2017, recommended allowing export of 1.2 million tons sugar in view of the available surplus.
PSMA''s request and the SAB''s recommendations were discussed in the meeting of inter-ministerial committee held on May 25, 2017. On the recommendations of the committee, the ECC in its decision of June 7, 2017 decided that in order to maintain the price stability during Ramazan, the decision on allowing further export of sugar may be deferred till the last week of Ramazan and that PSMA may be asked to express their "firm resolve in writing to maintain price stability" as agreed in SAB meeting on May 17, 2017.
The inter-ministerial committee reviewed the sugar supply and stock position in its meeting held on June 20, 2017. The committee was briefed that the price of sugar in the domestic market remained stable which has benefited the consumer. The price in the domestic market according to the SPI for the week ending June 15, 2017 was Rs 56.30 per kg which was 1.1 percent lower than the level of December 15, 2016 when the export of sugar was allowed by the ECC. The committee also observed that out of the total quantity of 0.425 million tons allowed for export by the ECC, a total of 0.391 million tons sugar quota, has, so far, been allocated by SBP and around 0.348 million tons have been exported.
The Additional Secretary, Ministry of Industries and Production informed the committee that the PSMA had provided the assurance that the instructions of the government regarding price stability of sugar "will be adhered to in letter and spirit".
After detailed deliberations, the committee agreed that the export of 0.6 million tons of sugar, in addition to the quantity already allowed for export of the ECC, may be allowed subject to the following condition: (a) the committee constituted by the Prime Minister will meet during first week of every month to review the sugar stock/export and price situation; (b) in case of any abnormal increase in the domestic price of sugar, the committee would recommend to the ECC the stoppage of further export;(c) the export quota will be approved and monitored by the SBP on first come first serve basis; and (v) exports will be completed within 60 days of quota allocation by the SPB.
"We have recommended that once 0.45 million tons out of the allowed quantity of 0.6 million tons is exported, the inter-ministerial committee will meet again to review the stock/export and price situation and recommend enhancement of export quantities, if deemed appropriate," the sources continued. PSMA has already rejected the government''s proposal regarding additional quantity of sugar export without subsidy.
Copyright Business Recorder, 2017