ISLAMABAD: The Federal Board of Revenue (FBR) has decided to install a video analytics system in sugar mills across the country to monitor stocks and the release of sugar from mill premises amid the Competition Commission of Pakistan’s accusations that government agreements with sugar mills have supported cartelization in the sector.
These viewpoints were expressed by FBR officials, led by Dr. Hamid Atiq, and CCP’s Director General (Cartels & Trade Abuse) Shahzad Hussain during a meeting of the Sub-Committee of the National Assembly Standing Committee on Commerce, headed by Dr. Ikhtiar Baig. The Sub-Committee’s purpose was to identify organizations and individuals responsible for the recent increase in sugar prices.
Video analytics systems process footage in real time and convert it into intelligent data. They automatically generate descriptions of activities occurring on screen (metadata) and are used to detect and track objects—such as people, vehicles, and inventory—within the video stream.
However, the Pakistan Sugar Mills Association’s (PSMA) representative, Imran Ahmed, opposed the new monitoring system, arguing that the existing track-and-trace system was sufficient to monitor sugar movement from the mills. His remarks were met with sarcastic smiles from senior officials of the FBR, Commerce Ministry, and CCP.
Officials noted that although the track-and-trace system remained suspended for a few days—possibly affecting the lifting of 150,000 tons of sugar—it had no impact on retail sugar prices. They added that when sugar lifting rose to 24,000 tons per day from the routine 14,000 tons, concerns arose within the government that the commodity was being stockpiled to drive up future prices. Pakistan’s monthly sugar consumption stands at 540,000 tons, or roughly 17,000 tons per day; lifting beyond 18,000 tons per day suggests hoarding or smuggling.
Regarding the suspension of sugar release through FBR portals, two FBR officials provided differing explanations. One official, representing the FBR in the Member’s absence, claimed the suspension was caused by a malfunction in the track-and-trace system. However, when the Member arrived from the Prime Minister’s Office, he stated that the seven-day suspension resulted from replacing the old monitoring system with a new one.
Dr. Hamid Atiq further informed the meeting that sugar production this year is expected to be up to 15 percent higher due to a 9 percent increase in cultivation area. He warned, however, that next year may again be difficult, as the industry is likely to push for more exports. The country is expected to produce 7.5 million tons of sugar this season, compared with 6.8 million tons last year.
He added that although the government had announced November 15, 2025 as the official crushing date, mills have yet to begin crushing except for Ramzan Sugar Mills, which has produced 10,000 tons so far. Mill owners reportedly want to commence crushing at the end of November, which may be delayed until the first week of December. The government has set the sugarcane support price at Rs 450 per 40 kg, but mills are currently paying around Rs 510 per 40 kg. Sugarcane prices may rise further by the end of the month. During discussions, the PSMA Secretary General stated that the government and mills had signed an agreement fixing the sugar price at Rs 165/kg, with a monthly increase of Rs 2/kg. His remarks prompted the CCP’s Director General to criticize the agreement, claiming it enabled cartelization.
“The agreements between the government and millers led to cartelization in the country,” said the DG CCP. He added that when millers agreed on price fixation with the PSMA, the association internally discussed reducing sugarcane prices.
When the Sub-Committee Convener accused the CCP of failing to curb cartelization, the DG defended the Commission’s actions, stating that “price fixation by the government and millers” constitutes clear cartelization. He emphasized that complete deregulation of the sugar sector is the only long-term solution.
The CCP also protested that the FBR has not shared sugar-lifting data with the Commission for the past six months despite repeated reminders.
The Convener also questioned the recent increase in sugar prices in Balochistan, where sugar is reportedly selling at around Rs 225/kg. Dr. Hamid Atiq said the FBR has raised this issue with the Pakistan Bureau of Statistics (PBS), as the data appears incorrect or may have been collected from an upscale area of Quetta. He questioned how sugar could be priced at Rs 225/kg in Quetta while it sells for Rs 197/kg in Khuzdar, a more remote region.
He proposed that the government should ban sugar exports and imports through all routes except sea channels and maintain a buffer stock of 540,000 tons to prevent smuggling and price escalation.
The Sub-committee will submit its recommendations to the main Commerce Committee for approval.
Copyright Business Recorder, 2025
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