Industries Ministry proposes 25pc duty on sugar import

LAHORE: The Industries Ministry has proposed 25 per cent import duty on sugar and sent a summary to the Economic Coordination Committee (ECC) of the Cabinet for approval, official sources said on Thursday.

The ECC will discuss the import duty on sugar in the next meeting and take decision on it, but there is no chance of import duty as Punjab Chief Minister Shahbaz Sharif had twice opposed it at open forums, the sources said.

The federal government did not want to indulge in any criticism from the Pakistan Muslim League (PMLñN) by imposing import duty on sugar.

Meanwhile, mill-owners are also mounting pressure on the federal government to impose import duty on sugar as it was affecting their business and causing surge in the financial liabilities, the sources said, adding that they are not paying off their loans, as well as not clearing the dues of the growers.

The sugar mill-owners have demanded 35 per cent import duty on the sweetener to protect the local industry from cheap sugar due to which their supplies had slowed down, The News learnt.

However, contrary to their demand the Industries Ministry after chalking out and consulting the stakeholders had proposed 25 per cent import duty to the ECC.

Sugarcane will be cultivated on over 0.2 million acres land this year and timely rain would also increase per acreage yield, as well as sucrose level in the crop. If the government does not bailout the industry from the imported sugar than the country would face crisis-like situation during the next crushing season as the mills would default and crushing would not be started.

It was further learnt that the sugar industry owed over Rs100 billion to the commercial banks for short-term working capital and long-term loans. The majority of the mill-owners had also not paid their last quarter installments due to slowdown in lifting of sugar from the mills. Similarly, there is no chance of timely payment of June quarter installments by the mill-owners to the banks.

In such a scenario, the banks would tighten their stance on the mills and there are likely chances that they might not issue the working capital to the mills for the next crushing season.

Sources in the sugar industry said that due to decline in international prices of the commodity, the local dealers were lifting limited sugar for not more then three days sale from the mills as they have been anticipating that the imported sugar would arrive in the local market at lower rates and their local procured sugar stocks.

source: thenews