ISLAMABAD: Finance Minister Shaukat Tarin is said to have decided to allow import of 50,000 tons of sugar despite opposition by the Ministry of Industries and Production (MoI&P), which says that ample stocks of sugar are available to meet the requirements till November, well informed sources told Business Recorder.
Trading Corporation of Pakistan (TCP) has recently received lowest bid of $ 692 per ton, which if approved by the ECC, will cost Rs 123 per kg after adding handling charges. The cost of previous tender was Rs118 per kg.
On September 23, 2021, Ministry of Industries and Production recommended the Economic Coordination Committee (ECC) of the Cabinet that tender may be scrapped in view of high prices as no active demand is there from the provinces.
The Ministry further argued that if ECC thinks there is a need for fresh tendering, it may be broken down to 50,000 MT, so that there is more participation and increased competition when international prices fall.
ECC likely to allow import of 100,000 MT of sugar
The MoI&P also proposed that if the ECC deems it appropriate to approve the tender, TCP may keep sugar reserves in government-owned godowns instead of going to expensive option of private godowns.
According to sources, Finance Minister Shaukat Tarin who is also the Chairman of the ECC invited comments from the participants. The matter was discussed threadbare. The Ministry of Industries and Production stated that there is reasonable stock available to meet the requirements of sugar in the country till mid-November, when the new crushing season will start.
The Minister for Energy, Hammad Azhar, stated that the concerned agencies must ensure that the crushing season starts by November 15, to ensure supply and price stability.
The Chairman ECC stated that although the stock position as reported by the Ministry of Industries and Production is satisfactory, yet there would be a possibility of shortage keeping in view the consumption trend.
Sugar import allowed by ECC
Finance Minister further contended that as this possibility might trigger speculation and consequent price hike; therefore, some quantity of sugar may be imported in order to build strategic reserves. Minister for National Food Security and Research supported these views.
After detailed discussion, the ECC directed the Ministry of Industries and Production to import sugar in a quantity of 150,000 MT in three consignments.
The ECC further approved that Provincial Governments must ensure starting of the crushing season by November 15, 2021 and if sugar is imported at a higher price, the government will subsidize it to ensure price stability.