India allows 500,000 tonnes of sugar exports

New Delhi, March 22 (IANS) The government Tuesday gave the green signal to export 500,000 tonnes of surplus sugar, which the industry association said would help improve cash flow of the companies and stabilise falling prices.

The Empowered Group of Ministers, headed by Finance Minister Pranab Mukherjee, gave the go-ahead to allow the export of 500,000 tonnes of sugar under open general licence scheme.

'We are thankful to the government for allowing the export of surplus sugar. It will improve the cash flow of the companies and also stabilise prices,' Avinash Verma, Director General of Indian Sugar Mills Association (ISMA), told IANS.

He said the industry association had been demanding to allow the export of 1 million tonnes of sugar as increased supply was forcing the companies to sell sugar at a price far below the cost of production.

Sugar output in India is estimated to increase to 25 million tonnes in the current fiscal as compared to 18.9 million tonnes in the previous year.

ISMA official said India has an exportable surplus of almost 3 million tonnes of sugar. As the price in international market is higher, sugar companies can make good money by selling sugar overseas.

On the impact of export on domestic retail price, Verma said, 'It should not affect the retail price much because there is surplus supply.'

According to the industry association, sugar mills are currently incurring loss of around Rs.150-200 on sale of per quintal, 100 kg, of sugar.

source: sify