Sufficient stock of 1.46 million tons sugar available in country, National Assembly told

Federal Minister for Industries Chaudhry Pervaiz Elahi has informed the National Assembly that sufficient stock of 1.46 million tons of sugar is available in country, which is sufficient till December 27, 2011. In a written reply, he informed the house that sugar price was increased by Rs 2.42 per kg during the month of Ramadan. At the same time, Sensitive Price Index (SPI) has shown an increase of 2.23 percent.
This shows that inflation is not specific to sugar but across the board, he added. "Sufficient stock of sugar is available in the country. At present, the country has 1.46 million tons of sugar stock, which is sufficient till December 27, 2011 on the consumption pattern of 350,000 tons per month. The price increase is due to hoarding and speculation," he added.
The minister stated that following steps have been taken to decrease/control the price of sugar: 100.000 tons of sugar at discounted rate of Rs 55 per kg was sold at USC outlets during the month of Ramazan. Sugar has been exempted from sales tax through Finance Act 2011 while eight percent Federal Excise Duty has been imposed. Moreover, the 2.5 percent SED has also been abolished, he added.
"With ex-mill price of Rs 60/kg, the eight percent FED is Rs 4.80/kg; wholesale price is Rs 65.80 per kg and retail price is Rs 66.8 per kg. Therefore, any increase in price above this is unwarranted," he added. He said that the provincial governments were responsible for taking measures to control hoarding and artificial shortage of sugar. To stabilise the price of sugar, government has allowed import of sugar without any regulatory duty and in the budget 2011-12, 2.5 percent Federal Excise Duty has also been withdrawn.
Regarding the allegations of smuggling, he stated that sugar price in India was PKR 61/kg. "Sugar smuggling to India is not a viable option with their sugar priced at Rs 10 per kg below our domestic price. There is in fact an incentive to smuggle sugar to Pakistan from India.
Sugar price in Afghanistan is PKR 104/kg, but its annual demand according to ISO (International Sugar Organisation) is only 235,000 tons which is imported from India, China and Brazil. Smuggling of sugar to neighbouring countries is not a viable option with high fuel cost by road. However, as a matter of abundant precaution Interior Ministry is taking preventive measures to check sugar smuggling," he added.
To a question, Minister for Ports and Shipping told the house that no cash guarantee to Gwadar Port has been provided by PSA. However, the Port of Singapore Authority Private Limited has submitted a performance bond dated March 2, 2007 worth $20m, as a security guarantee that the Concession Holder picks up for revenue the first cargo loaded or unloaded onto or from a ship calling at existing facilities & installs and commissions two (02) STS Gantry crane within nine months.
The said performance bond has been retained by the GPA. "It is wrong to assume that the PSA has abandoned operations to make Gwadar Port functional," he added. Responding to a question, Minister for Industries said that as per FBS data Urea price in the market remained Rs 1726/50 kg bag for the week ending on August 18, 2011 whereas as it was Rs 846/50 Kg bag for the same period in 2010.