ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has indicated the possibility of deregulating the entire sugar sector in order to avoid controversies and unjustified price hikes of the commodity in the country, well-informed sources told Business Recorder.
The sugar issue was discussed at the ECC meeting on April 7, 2025, presided over by Finance Minister Senator Muhammad Aurangzeb, as part of a sundry decision.
Sources revealed that the ECC deliberated on topics such as sugarcane, crop zoning, storage, and the import and export of sugar. It was emphasised that deregulation of the entire sector should be considered rather than resorting to piecemeal solutions, which could prove counterproductive, the sources added.
De-regulating the sugar industry: do not drop the ball again
The ECC noted that the impact of deregulation on local storage, and the demand and supply of sugar, should be assessed.
A comprehensive report should be presented by the Ministry of National Food Security and Research, similar to the approach planned for wheat.
Following the discussion, the ECC directed the Ministry of National Food Security and Research to provide a holistic analysis of the sugar sector’s value chain, covering all necessary aspects, with a view to potentially deregulating it.
Meanwhile, the Federal Board of Revenue (FBR) has fixed the minimum ex-mill value of white crystalline sugar starting from April 1, for the assessment of sales tax. In this regard, the FBR issued SRO 577(I)/2025. The minimum value of white crystalline sugar is set at approximately Rs153 per kg.
The SRO 577(I)/2025 supersedes the previous notification No SRO 1027(I) 2021, issued on August 16, 2021, which had fixed the ex-mill value of sugar.
Under the new SRO 577(I)/2025, the minimum value, including sales tax, of domestically produced white crystalline sugar is calculated based on the average national retail price of refined sugar, as last published by the Pakistan Bureau of Statistics (PBS) on its website (weekly sensitive price indicator - SPI) before the 1st and 16th of each month.
This price is then reduced by 16 rupees for the respective fortnight starting on the 1st and 16th of each month.
In the previous SRO 1027(I) 2021, the FBR had set the ex-mill value of white crystalline sugar for sales tax assessment at Rs72.22 per kg.
Copyright Business Recorder, 2025
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