Pakistan’s sugar policy is facing renewed scrutiny after the government approved another 100,000 tonnes for export.
The decision comes while questions remain over costly imported sugar held by the government. A separate proposal involving 250,000 tonnes of locally produced sugar has not been finalised.
The situation has created uncertainty for sugar mills ahead of the next sugarcane purchasing season. Mill owners have reportedly shared their concerns with the Ministry of Industries.
Sugar Import and Export Decisions Under Scrutiny
Former finance minister Miftah Ismail has questioned how the government managed sugar exports and subsequent imports. According to Ismail, Pakistan allowed 750,000 tonnes of sugar exports last year.
He said domestic prices later increased by as much as Rs50 per kilogram. The government then directed the Trading Corporation of Pakistan to import 300,000 tonnes of sugar.
Private-sector imports were not permitted at the time, according to his account. Ismail alleged that TCP paid up to $40 per tonne above prevailing international market prices.
He also said imported sugar received exemptions from sales tax and excise duty. Despite those exemptions, he claimed the imported stock remained more expensive than sugar available locally.
Efforts to Sell Imported Sugar
According to Ismail, officials later tried to sell government-held sugar to major commercial buyers.
The effort reportedly involved representatives from TCP, the Federal Board of Revenue and the Intelligence Bureau. Industries, chain stores and brokers were among the potential buyers.
Ismail alleged that the offered price was above prevailing domestic market rates. He further claimed sugar mills were discouraged from supplying customers targeted for government-held stocks.
The reported effort, however, did not clear the full inventory. These claims have been presented by Ismail as criticism of the government’s sugar policy.
Why the Latest Export Decision Matters
The latest approval has reopened questions about how Pakistan will manage remaining sugar stocks.
Critics fear government-held imported sugar could eventually be exported below its original purchase cost. Such an outcome could leave the public exchequer carrying the difference.
The source material does not provide an official estimate of any eventual loss. The issue also extends beyond government finances.
Sugar mills need capacity and liquidity to purchase sugarcane when the next crop reaches the market. Uncleared sugar stocks could make that process more difficult.
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Farmers may therefore face uncertainty if mills struggle to purchase the upcoming crop. Consumers remain another important part of the debate after previous increases in domestic sugar prices.
