Pakistan to export 40,000 tonnes of sugar to Tajikistan

Israr Khan

14 August 2024

Published in: The News

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Pakistan has agreed to export 40,000 tons of refined sugar to Tajikistan at preferential prices under a government-to-government (G2G) arrangement through the state-run Trading Corporation of Pakistan (TCP).

The deal, however, still requires formal approval from the Economic Coordination Committee (ECC) and the federal cabinet. The Ministry of Industries and Production has already sent a summary to the ECC, which is scheduled to review the proposal on Thursday.

A senior official told ‘The News’ the Tajikistan’s prime minister had recently requested Prime Minister Shehbaz Sharif for the provision of 40,000 metric tons of sugar at reduced rates. In addition, Tajikistan is seeking financial assistance from Pakistan to cover usage fees at Karachi Port, related to the import of goods by the Agency of State Material Resources under the Government of Tajikistan, the official said.

Currently, the ex-mill sugar price in Pakistan is around Rs140 per kilogram, and the government plans to provide the sugar at a rate between Rs133 and Rs136 per kilogram.

Meanwhile, the federal government’s Sugar Advisory Board (SAB) has formally approved the export following an earlier government decision in June 2024 to allow the export of 150,000 tons of sugar. The SAB, chaired by Federal Minister for Industries and Production Rana Tanveer Hussain, recommended the export proposal to the ECC. The board includes representatives from the federal and provincial governments, the sugar industry and other stakeholders.

The Ministry of Industries and Production is set to present the proposal to the ECC, which will review the latest developments in the sugar industry before making a final decision.

In June 2024, the government conditionally approved the export of 150,000 metric tons of sugar, mandating the Pakistan Sugar Mills Association (PSMA) to maintain adequate local stocks to ensure stable domestic supply and prices. The SAB reviewed the sugar stock position in the country, which currently stands at 2.852 million metric tons—sufficient to meet local demand. The PSMA noted a surplus of 1.5 million metric tons of sugar, advocating for exports to support the sugar industry and help meet financial obligations to growers.

The federal minister directed the Ministry of Industries and Production, provincial cane commissioners and the Federal Board of Revenue (FBR) to reconcile the stock figures and present a report at the next meeting of the advisory board. During the meeting, the PSMA representatives asserted that there had been no increase in the ex-mill price of sugar and that the ex-mill price is unrelated to the retail price. They urged the government to take steps to maintain the retail price through district administration. The federal minister directed the provinces to take strict action against hoarders.

On June 25, 2024, the federal cabinet approved the export of 150,000 metric tons of sugar and established a ‘Cabinet Committee on Monitoring Sugar Exports’ to oversee prices and compliance. The committee is tasked with ensuring that ex-mill sugar prices do not exceed Rs140 per kilogram, while retail prices are capped at the SPI benchmark as of June 13, 2024, plus Rs2. If prices exceed these limits, the committee will instruct the Ministries of Industries and Commerce to halt exports.