The Pakistan Sugar Mills Association (PSMA) has asked the government to import 500,000 tons of raw sugar and impose complete ban on export of gur (raw sugar) to overcome likely sugar crisis in the country. In a letter, exclusively available to Business Recorder, PSMA Chairman Iskander M Khan has requested the Planning Commission to allow import of 500,000 tons of raw sugar and impose a ban on export of gur for avoiding another crisis.
He said that Trading Corporation of Pakistan (TCP) stock would stand at 689,005 tons, as the ongoing import of refined sugar is completed. He said that production during crushing season 2010-11 would be between 3.30 million tons and 3.60 million tons. There is need of 4.5 million tons of sugar from October 1, 2010 to October 30, 2011, approximately 13 months, for local consumption. Keeping this situation in view, there is need to import 500,000 tons of raw sugar, for processing, to overcome sugar crisis, he said.
"In case of any revision in the production of sugar in the country, the decision to import refined sugar can be taken after closure of the season, because at that time, the price of sugar in the international market is expected to be lower as compared with the prevailing prices," he suggested.
He said that raw sugar is industrial raw material for sugar industry; therefore, the quantity of 500,000 tons of raw sugar should be distributed among sugar mills, based on their past 3 years' sugarcane crushing, to ensure transparency.
"Sugar industry in the Khyber Pakhtunkhwa is capable of producing up to 100,000 tons of sugar in the Peshawar Valley; therefore, the Cabinet's decision to ban export of gur (raw sugar) should be implemented in letter and spirit, the letter said, adding that it would enable the government to save $70 million, and to generate revenue up to Rs 500 million from the production of the above said quantity."
Iskander said there is no sales tax or any other tax on commercial manufacturing of gur, and individual manufacturer is making huge profits at the cost of exchequer. Permission to engage in tax-free manufacturing and its export to Afghanistan is bringing no foreign exchange earning to the government and facilitates smuggling of sugar in the guise of gur, which should be stopped in national interest, he said. He appreciated Economic Co-ordination Committee's decision for waiving 25 percent customs duty, which, according to him, would ensure availability of the commodity at reasonable rate in the days to come.