Govt may allow sugar exports with a rider

NEW DELHI: The UPA government at the Centre is hesitant on allowing higher sugar exports despite a high output of 193 lakh tonnes this year and may end up permitting only 10 lakh tonnes. “There is a demand to allow export of 30 lakh tonnes. But we are likely to allow only about 10 lakh tonnes,” a senior food ministry official said.

High international sugar prices are also spurring on the domestic industry to export as much as possible, taking advantage of the expected bumper sugar production of 227 lakh tonnes for ’06-07 sugar season (Oct-Sept).

After releasing an whopping 16 lakh tonnes of free-sale sugar in October to meet the festive demand like Diwali and Ramazan, the government is left with only 26 lakh tonne of stocks and the high sugar production this year will be utilised to augment the buffer stocks, the official said. The production of 193 lakh tonnes will be one of the highest in the recent years and sugar output touched over 200 lakh tonnes only in ’02-03.

A factor that might weigh in favour of higher sugar exports would be the arrest in its domestic prices despite the fast approaching Diwali festival.

However, according to the officials, the bulk of the sugar demand from sweetmeat shops and other bulk consumers had already been met and it was only the retail customers who would be purchasing sugar in large quantities. “Despite Diwali, prices have not gone up due to our efforts in maintaining adequate supplies,” the official said.

Meanwhile, many sick and unviable sugar units have approached for assistance under the Sugar Development Fund, which has a corpus of over Rs 300 crore currently.