The government and the Pakistan Sugar Mills Association (PSMA) on Tuesday finalised the modalities for crushing season 2007-08, accepting each other''s major demands. The government agreed that Trading Corporation of Pakistan (TCP) will buy 0.4 million tons sugar from the millers to facilitate their start of crushing season with adequate financing.
In return, Pakistan Sugar Mills Association (PSMA) assured timely start of upcoming crushing season, and continuous supply of sugar to the market at reasonable price. However, the government kept the pendulum on its side by telling the industry that the rates at which TCP would buy sugar from it, to build up buffer stocks, would be worked out on open market basis.
Advisor to Prime Minister on Finance Dr Salman Shah and Advisor to Finance ministry Dr Ashfaque Hasan Khan represented the government during the meeting. PSMA side comprised chairman Shunaid, Qureshi Sikandar A khan, Aslam Farooq, Haroon Akhtar Khan and K.A.Qazalbash.
The PSMA team assured the government representatives that sugar industry would enter crushing season from the first week of November and would keep supply to the market intact. It informed the authorities that adequate sugar stocks were available to cater the local market demand by the end of November.
Sikandar said: "We assured the government side that the stocks in hand were enough to keep sugar supply uninterrupted by the end of November and before that the new arrival will start coming in to build-up stocks".
The government reiterated that sugarcane support price for the next season would remain unchanged. The government has fixed sugarcane support price at Rs 60 per maund for Punjab and Rs 65 for Sindh and NWFP. The industry side demanded immediate ban on import of sugar from India. It argued that imported Indian sugar was of low quality due to high accumsa. The government did not show any immediate response to this PSMA demand.
The industry is demanding upward revision in duty to discourage import of sugar. The government is reluctant to take any such steps which shows that it wants to keep the option of outsource open to maintain it as a threat to the local industry.