Ban lifted on export of sugar

The Cabinet has lifted the ban on sugar exports after a gap of about six months. On July 4 last year, the government had banned export of sugar till March 31, 2007, on the recommendation of the Cabinet Committee on Prices.

However, after continued demand from the sugar industry and assessing the sugar situation, a decision has been taken to lift the ban.

"The ban has been lifted in view of higher production and comfortable stock," Finance Minister P Chidambaram said after today's Cabinet meeting.

International sugar prices have declined from about $460 a tonne to $330 since the ban was imposed, rendering exports unattractive for domestic millers.

Even the domestic price has declined from Rs 1,750 a quintal to Rs 1,550 over the period.

On December 18, the Union Cabinet had partially lifted the ban on sugar exports and a decision was taken to open exports for the companies with export obligations under the Advance Licence scheme.

"A right thing has happened at the wrong time. The ban should have been lifted long back," said SL Jain, director-general of the Indian Sugar Mills Association.

"Lifting the ban will give a lease of life to the domestic sugar industry," said Vinay Kumar, managing director, National Federation of Cooperative Sugar Factories.

According to him, the country must have produced 7.5 million tonnes of sugar so far in the current season. The country is likely to produce 23 million tonnes of sugar this year.

Though late, it is a welcome decision. There is surplus sugar available in the country and it should be exported to arrest declining domestic prices, said Sanjay Tapriya, director (finance), of Simbhaoli Sugar Mills.