The federal government’s plan to fully deregulate the Sugar Sector remains stalled, as provinces have yet to take legislative action.
Deregulation of the Sugar Sector is part of conditions agreed with the International Monetary Fund (IMF). The IMF has set a deadline for March 2026. The federal government must completely exit the sector by June this year.
Currently, no progress has been made at the provincial level despite repeated requests from the Ministry of Industries and Production. Sources say delays could affect compliance with IMF agreements.
Once deregulated, the government will stop intervening in pricing, procurement, and supply of sugar. All trading and handling will be managed entirely by the private sector.
The move aims to ensure better market-driven prices for sugarcane farmers. In case of surplus production, sugar will be exported freely, allowing farmers to benefit from competitive rates.
After deregulation, sugarcane farmers will not be obligated to grow sugarcane and can sell their crops to any sugar mill in the country. This will increase competition and improve farmers’ earnings.
Additionally, there will be no government restrictions on establishing new sugar mills. The ban on sugar exports will also be lifted once deregulation is implemented.
Officials say deregulation of the Sugar Sector is expected to modernize the industry and make it more efficient. Private companies will have more flexibility in production, trade, and exports.
Farmers and industry stakeholders have expressed cautious optimism, highlighting the potential benefits of a market-driven approach. However, uncertainty persists until provincial governments pass the required legislation.
The federal government is urging provinces to act swiftly to meet the IMF’s deadline. The success of sugar sector deregulation could have long-term impacts on production, pricing, and exports in Pakistan.
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