They said the Prime Minister has convened a meeting on Friday to discuss the issue of non-compliance of SBP's orders by the majority of sugar mills. An official told Business Recorder on Thursday the list of sugar mills that did not respond to SBP orders and were involved in hoarding and ignored repeated government calls for timely release of stocks in the open market will be presented before the Prime Minister. Interestingly, all the mills listed as hoarders are from Punjab and their owners highly influential.
The list made available to Business Recorder indicated that the mills in Sindh and the NWFP have very little unsold stocks. The official said hoarding of stocks by the majority of sugar mills and almost imminent default on payment of seasonal loans to the banks were serious issues and the meeting will take important decisions in this regard.
He added that various options were under discussion as far as non-compliance of SBP's orders by the sugar mills was concerned and punitive action was one of them. The official, however, did not divulge other options, saying let the meeting take place and then things will become crystal clear.
The officials here have strong feelings that the powerful mills owners were hoarding huge stocks with a view that the sugar prices will once again go up in the coming weeks providing them another opportunity to make undue profit on their stocks.
It may be noted that the SBP had last month set deadline of July 31 for the industry for payment of the seasonal loans. It also imposed 50 percent cash margin condition for the new loans. The sugar industry had raised the issue with SBP Governor Dr Shamshad Akhtar, during a meeting held here on July 9, to convey to her that the deadline of July 31, for payment of seasonal loans was impracticable and it should be relaxed. They also demanded relaxation in the cash margin condition.