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ISLAMABAD: The government has directed Ministry of National Food Security and Research to convene a meeting of Sugar Advisory Board (SAB) in the first week of January 2023 to review position of sugar exports and impact on its price in the local market, official sources told Business Recorder.

Sharing the details, sources said, the third meeting of SAB was held on December 14, 2022, under the chairmanship of Federal Minister for National Food Security and Research wherein data provided by provinces, PSMA and FBR regarding sugar stocks for 2021-22, sugarcane production estimates 2022-23, sugar production estimates 2022- 23and estimated annual sugar consumption came under discussion. During the meeting, stock position, crushing status in each province and recommendations of Punjab and Sindh for export of sugar were also discussed.

According to sources earlier the Prime Minister’s Office had directed the M/o NFSR to hire a reputable audit firm for authentication of sugar stocks available with the sugar mills at the earliest. It was also advised that option of engaging an internationally recognized Audit Firm for this purpose on pro bono basis may also be explored.

In compliance with the directions of Prime Minister’s Office, M/oNFSR explored both options i.e. contacted big-4 Audit Firms for authentication/verification of sugar stocks claimed by PSMA on pro bono basis but received no positive response.

Thereafter, Ministry advertised in national dailies on December 9, 2022 for hiring of Audit Firm as per PPRA Rules. The SAB during its third meeting decided that Prime Minister’s office would be approached to review its earlier decision regarding the hiring of an independent Audit Firm by NFS&R for verification and authentication of sugar stocks reported by PSMA, as the process would take considerable time therefore reliance be on the data / information provided by FBR duly signed by Chairman, FBR, as decided in 2nd meeting of the SAB. Accordingly, the M/ONFSR requested the PMO for review of its earlier decision on December 14, 2022.

Ministry of National Food Security and Research further stated that during the SAB third meeting the following recommendations had been made: (i) SAB will recommend to the ECC export of sugar up to 100,000 MT;(ii) quota will be given to PSMA for further distribution to the millers (only filers);(ii) situation shall be reviewed fortnightly.

PSMA shall undertake that price of sugar will not increase in domestic market from Rs. 85-90 / kg (ex-mill) for 2021-22 stocks;(iii) in case of increase in domestic sugar price, SAB shall recommend to ECC to discontinue exports on immediate basis;(iv) no subsidy whatsoever shall be provided to exporters by the Federal / Provincial Governments;(v) PSMA and Cane Commissioners shall ensure approved MIPs and timely payment to the growers; and (vi) Prime Minister’s office will be approached to review its earlier decision regarding the hiring of an independent Audit Firm by M/o NFS&R for verification and authentication of sugar stocks.

Ministry of National Food Security and Research proposed that in view of recommendations of the SAB, ECC may allow export of sugar upto 100,000 MT, subject to approved conditions and concurrence of M/o Industries and Production, Commerce and Finance, as well as review of decision to hire an independent Audit Firm by Prime Minister’s Office.

The sources said, ECC held threadbare discussion on the issue and observed that sufficient stock of sugar was available in the country to meet domestic requirement. It was of the view that keeping the on-ground situation in mind, 100,000 MT of sugar could be exported in light of recommendations of SAB. It was contended that the proposed export would not only solve liquidity problem of sugar mills in making payment to sugarcane growers but it would also earn foreign exchange for the country.

The ECC also observed that the proposal for further export of sugar could be considered, subject to availability of surplus sugar in the country, in the first week of January, 2023. For the purpose SAB would review the stock position of sugar in the country and would give viable recommendations thereon.

The ECC approved the proposals with the following modification:(i) SAB will recommend to the ECC export of sugar up to 1000,000 MT. Quota will be given to PSMA for further distribution to the millers (only filers). Situation shall be reviewed fortnightly.

Pakistan Bureau of Statistics (PBS) shall furnish information on sugar prices in the country on bi-weekly basis to Ministry of National Food Security and Research, which shall be shared with ECC for its consideration;(ii) PSMA shall ensure that existing price of sugar will not increase in domestic market from Rs. 85-90 / kg (ex-mill) till January 31,2023; and (iii) Prime Minister’s office will be approached to review its earlier decision regarding the hiring of an independent Audit Firm by M/o NFS&R for verification and authentication of sugar reported stocks in view of FBR’s Track & Trace data as well as data provided by the provincial governments of Punjab and Sindh.

The ECC also directed that SAB shall convene its meeting in first week of January, 2023 to review position of sugar exports and its impact on the local price of sugar and recommend further export of sugar subject to availability of surplus stock of sugar in the country.

The sources said Federal Cabinet in its meeting held on December 28, 2022 has ratified the decisions of the ECC, adding that as decision of Cabinet is shared with Commerce Ministry, it will issue SRO to allow export of 100,000 MTs of sugar.

Copyright Business Recorder, 2022

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