Sugar export: PSMA, AFP not on the same page

FAZAL SHER

ISLAMABAD: Pakistan sugar Mills Association (PSMA) is urging the government to allow the export of sugar while Agri Forum Pakistan (AFP) is opposing the idea. However, a former advisor to Ministry of Finance termed sugar a political crop and sugar industry a political industry owned by politicians across the political divide.

Dr Ashfaq Hassan Khan said that export of sugar could be allowed only if the PSMA gave an assurance that the price of sugar in the domestic market would not increase. However, he said that being a political crop any decision on this issue would take account of political considerations in total disregard to the interest of Pakistani consumers.

Javed Kayani, Chairman PSMA, vehemently argued that export of sugar would benefit millers as well as growers, therefore, the government needed to export 100,000 tons of sugar and Trading Corporation Pakistan (TCP) should purchase 400,000 tons of sugar as commodity was in surplus.

"Pakistan's annual sugar consumption is about 4.2 million tons, and this year the country is expecting about 5 million tons production from the 2011-2012 crop," he said.

The export of sugar would help millers make payment to growers while the country would earn foreign exchange of $60 million, he maintained.

Kayani said that export of sugar would not affect prices of sugar in the local market as Pakistan had surplus commodity.

However, Ibrahim Mughal, Chairman Agri Forum Pakistan, while opposing the idea of sugar export said that the authorities should not take any decision in this connection till April 15, when the sugar industry would be in a position to give final production figures.

He feared that if the government failed to achieve the set target, the price of sugar would increase from current Rs 50 per kilogram to Rs 70 per kilogram.

Mughal said that mills in Punjab would be producing three million tons of sugar, in Sindh 0.9 million tons and in Khyber Pakhtunkhawa 0.4 to 0.5 million tons. In such a situation, if the government allowed export of sugar, the consumers had to buy it at expensive rate.

However, he said that the government might allow export of sugar if output were 4.9 million tons.