Centre agrees to import 5 lakh mt sugar on mill lobby body's 'suggestion'

With the government allowing duty free import of 5 lakh MT of raw sugar to meet domestic requirements, it seems the Centre is just replicating the "suggestions" of sugar mills' body than finding out "actual" demand of the sweetener to address price rise issue.

The Centre has taken the decision to import raw sugar on the "advice" of Indian Sugar Mills Association (ISMA) as the body in its letter to Consumer Affairs Ministry had recommended the government to procure sugar not more than 5 lakh MT from overseas.

According to sources, ISMA through a letter to the ministry in February, had stated that the country has enough sugar to meet its domestic demand so import was not needed and if government 'wants to import for their own comfort, not more than 4 lakh MT to 5 lakh MT of sugar should be allowed to be imported.

"The move is an intelligence failure of the government as why the Centre is forced to follow recommendations of sugar mills' body when it has a better system in place to analyse the actual demand. Since, the government has sugar production data that can help officials in evaluating domestic requirements. Given the production estimates, the import figures could have been more than what has been allowed," a source from industry said.

However, hailing the decision Consumer Affairs Minister Ramvilas Paswan said that in order to address regional production gaps and to maintain domestic prices at reasonable levels, it has been decided to allow import of a restricted quantity of only 5 lakh MT of raw sugar at zero duty through open general license.

The minister further stated that considering the quantity of sugar available as opening stocks and the production in the current sugar season, it is estimated that there is adequate quantity of sugar available in the country for domestic consumption.

Notably, the South Indian Sugar Mills Associations had in a March 6 presentation to the Food Ministry said that unrestricted and uncontrolled imports will burden the sugar industry and farmers in the medium and long term.

According to ISMA data, India imported 4.08 MT of sugar in 2009-10 and exported 5.6 MT in 2010-11 and 2011-12. Imports totalled 7.74 lakh MT even as production exceeded demand in 2012-13 and 2013-14.