Government imports expensive sugar instead of buying cheap from local industries

In order to stock Utility Stores, the federal government has imported what has been dubbed the “most costly” sugar in the country’s history.

From the United Kingdom, a shipment of 28,760 metric tons of sugar imported by the Trading Corporation of Pakistan (TCP) arrived in the country. At the port, TCP paid Rs109.90 per kg for the imported sugar, which was acquired by the company. In comparison, the land cost of 100,000 tonnes of sugar last year was Rs89.26 per kilogram of sugar.

After deducting all of the charges, the Utility Stores would obtain sugar at a cost of approximately Rs123 per kilogram.

Ex-mill rates for sugar produced in the country have been set at Rs84.75 per kilogram by the authorities.


As a result, depending on the current exchange rate, imported sugar would be Rs25.15 per kg more costly than the official ex-mill pricing.

Sugar would be provided to the Utility Stores at a greater cost of Rs33.25 per kg than the official pricing, according to the agreement.

A subsidy program will cover the difference between the purchase price and the sale price of this sugar, which will be sold at the Utility Store for Rs85 a kilo according to the government’s decision.


Iskander Khan, chairman of the Pakistan Sugar Mills Association, expresses regret that the government is importing sugar at a cost of Rs140 per kg, excluding sales tax, in order to sell it at a cost of Rs90 per kg in the local market, but is not willing to purchase the sweetener from the local industry at a cost of Rs104 per kg.


“By providing substantial subsidies on imported sugar, the government demonstrates that it is more concerned with foreign growers than with local producers.” As part of its sugar importation program, the federal government is bringing in 200,000 metric tonnes of sugar, with 150,000 metric tonnes of that sugar being given in Punjab at a rate of Rs90 per kilogram.

When the next crushing season begins in just a few weeks, Mr. Khan is concerned that the government’s action will have a negative impact on the local growers because the mills are likely to default on payments to them for their products as a result of cash shortages caused by the alleged sealing of sugar storage facilities.

He claims that the millers will decide on their course of action in a general body meeting that will be scheduled soon.

According to a representative of the MNFS&R, the action was necessary because sugar millers began ’emptying out’ their stocks at unofficial rates in the pretext of previous contracts with dealers and distributors.

In response to a question, he stated that the decision will not have an impact on the upcoming crushing season because the authorities have contingency measures in place. He goes on to say that the market will be saturated with the imported sweetener at a rate of Rs90 per kg, leaving little opportunity for the local sugar industry to sell its products at a rate of Rs100 or more per kg.

As the sucrose content in the sugarcane crop reaches a satisfactory level even in October, according to the officials, the cost of production for the mills erected along Sindh’s coastline line is around Rs70 per kg.

He is confident that these coastal plants will begin crushing immediately, regardless of whether or not the PSMA issues a directive, and that many additional mills throughout Sindh and Punjab will follow suit as soon as possible.

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