The Pakistan Sugar Mills Association (PSMA) has urged the government to place import of Indian sugar on negative list immediately as its import would hurt the interests of the cane growers and the industry.
"India has allowed export of 0.5 million tons white sugar, and Pakistan can be a possible destination through Wagah border and Haldia Kandla ports," said PSMA Chairman Javed Kayani in a letter written to the Ministry of Industries and Production.
He reiterated that decision to import sugar to meet any expected shortfall should only be taken when the crushing season is over and the production figures firm up.
He also drew attention of the authorities to the outcome of the ministerial meeting on sugar held on November 11, 2010 before the commencement of crushing season, wherein it was decided that another meeting to review the production estimates should be held in February 2011, prior to deciding on how much sugar should be imported.
According to PSMA, initial estimates of production for the 2010-2011 season to produce 3.7 million to 3.8 million tons shall hopefully be achieved and with remaining inventories of TCP, shortages are highly unlikely. However, to safeguard the interests of the consumers, the GoP should hold a meeting with stakeholders after the close of the season.
Kayani further highlighted in his letter that international price of refined white sugar is more than $800 per ton, at present, and with the addition of the freight factor sugar would cost around Rs 95 per kg.
He said sugar prices for the April/May and June//July delivery are about $650 per ton which might come down further after the crushing season; so the timing for the import is very important if the government intends to save foreign exchange of the country.
When contacted, Javed said that Indian sugar can hurt the interests of local growers as imports from India may compromise payments to growers. In addition, the industry which is already buying sugarcane at over Rs 225 to Rs 250 per 40 kg, would not be able to survive, he added.
According to PSMA, it is imperative to include sugar in the negative list in order to protect the interests of stakeholders in the country.
Javed argued that Pakistan does not need to resort to import in the coming year as, hopefully, with higher price of sugar cane its shortage would be over in years to come which would be a step toward self reliance.
PSMA maintains that it alone provides a true perspective as its forecasts are reliable because the data is derived from respective fields of member mills. And it urges the GoP to focus its decision making to save the consumers from catastrophic price spiral.
"Government must take business decisions which should not fall prey to procedural and bureaucratic red tape," he said.
The government had allowed duty-free import of raw sugar through the private sector a couple of months ago, but no one came forward as the price of raw sugar skyrockeyted subsequently.