Pakistan Sugar Mills Association (Punjab Zone) has urged the government to immediately build buffer stocks of 500,000 tonnes at already agreed price of Rs 31 per kg, to enable the sugar mills to start next crushing season in time and also clear the growers' dues.
PSMA (PZ) Chairman, Chaudhry M. Zaka Ashraf along with Executive Committee members Javed Kiyani and Chaudhry Waheed told newsmen at a press conference here Friday. They said that in case government cannot ensure Rs 31 per kg price of sugar, it should consider reducing the sugarcane price from Rs 60 per 40 kg to Rs 40 per 40 kg.
They said that sugar industry was merely a processing industry that needs to survive by recovering its cost and honour its obligations to sugarcane growers, workers, government and other business obligations. Responding to a query, Zaka said that at present millers owe Rs 4-5 billion to growers in Punjab zone only.
PSMA leaders said that the members were apprised about PASMA's delegation meeting with Secretary Planning Commission for power co-generation and Ministry of Food, Agriculture and Livestock (Minfal) on upcoming crushing season.
He said the Planning Commission informed the PSMA delegation that government wanted to encourage the sugar industry to come forward and help it in reducing electricity shortfall. Sugar industry can generate electricity by using begasse as fuel during crushing season and coal and furnace oil during off-season as alternate fuel. A committee has been formed with Secretary Planning Commission Asif Bajwa in the chair for co-generation of power by sugar mills. The cabinet has approved purchase of electricity through co-generation by the industry. Power rates would be floating by linking with price of coal and furnace oil, he added.
Regarding PSMA's meeting with Minfal, Chairman PSMA Punjab Zone apprised the members that PSMA central organisation reminded the government that it failed to honour the commitment of ensuring sugar price of Rs 31 per kg ex-mill that shattered sugar industry's confidence in general. As the government backed out from its commitment and forcibly crashed the market by off loading subsidised sugar in the open market instead of limiting it only to the poor segment of society.
On top of it, the government had increased minimum support price of sugarcane from Rs 45 to Rs 60 (33 per cent increase), and minimum wages from Rs 3000 to Rs 4000 and now 4,600, therefore, industry has suffered heavy losses during the last two years. Adding they said that the industry is not in a position to make payments to growers' wages to employees and other business commitments.
Imposition of one-per cent Special Federal Excise Duty on the production was also highly criticised by the PSMA. They said that it has added fuel to the fire apart from pushing the industry to a situation where it is impossible to start the next crushing season. The Sugar industry is forcibly being pushed into crisis through extra burden of taxes and increase in raw material prices, they concluded.
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