Government allows import of 3 lakh tonne sugar at 25% duty

September 07, 2017 20:48

The government today allowed import of 3 lakh tonnes of raw sugar at concessional duty of 25 per cent to augment domestic supplies ahead of the festive season.

It had hiked import duty on sugar in July to 50 per cent from 40 per cent to curb dumping of the commodity in India as international prices fell.

"To supplement the availability of sugar in southern India and to stabilise sugar price, import of 3 lakh MT of raw sugar through southern ports of India at 25 per cent import duty under Open General License (Tariff Rate Quota) has been allowed through millers/refiners," a statement from the food ministry said.

The imports will be allowed through the ports of Tuticorin, Karaikal, Chennai, Mangalore, Kakinada, Gangavaram and Vishakapatnam in the South, it added.

"The import shall be open to millers/refiners who have their own capacity to convert raw sugar into refined /white," the statement added.

Sugar production in India, the world's second largest producer, is estimated to decline to around 21 million tonnes in 2016-17 season ending September from 25 MT in the previous year. The annual demand is 24-25 MT.

National Federation of Cooperative Sugar Factories MD Prakash Naiknavre told PTI that the decision is "in right direction because southern states specially Tamil Nadu is reeling under third consecutive year of drought and not having adequate sugarcane for the next crushing season. As a result this crushing capacity with mills would have remained unutilised".

The raw sugar arriving at end October will be handy to attain adequate utilisation of crushing capacity, he added.

Asked about the impact on sugar prices, Naiknavre said: "This will not have an impact on prices on all-India basis because quantity is limited and arriving at restricted ports in southern states."

The government had in April allowed duty free import of 5 lakh tonnes of raw sugar to boost domestic supply.

Last month, the government had imposed stock limit on sugar mills for the next two months to keep prices in check during the festive season.

By the end of September, a mill cannot keep more than 21 per cent of its total sugar availability for the entire 2016-17 marketing year and a factory cannot hold more than 8 per cent at the end of October, according to the government notification issued last month.

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