Sugar market reform on the horizon

(Web Desk): The government has made a principled decision to gradually deregulate the sugar industry, under which only 500,000 tons of sugar will be maintained as buffer stock by the state, while the rest of the market operations will be handled by the private sector.

According to informed sources, a draft proposal regarding deregulation has been prepared, which will be presented to the Prime Minister next week.

Sources further stated that the Trading Corporation of Pakistan (TCP) will hold only one month's worth of sugar consumption as a reserve, to ensure an immediate response in emergency situations. Beyond this, the government will not intervene in the production, pricing, or sale of sugar.

According to the proposals, if sugar prices become unstable, the government may increase the amount of subsidies to provide relief to consumers.

Officials believe that deregulation will not only increase market competition but also help sugarcane farmers receive better prices for their crop. Sources added that producing sugar in surplus will not only meet domestic demand but also allow for exports, bringing in valuable foreign exchange.

The government aims to increase the production capacity of sugar mills from 50% to 70%, which would enable the production of an additional 2.5 million tons of sugar annually. This extra sugar is expected to generate around $1.5 billion in foreign exchange through exports.