The government has allowed sugar mills to export the sweetener without release order till October and would take a decision by the end of this month on whether to continue the sop or to re-introduce control regime.
In order to help the sugar industry liquidate surpluses in the overseas market, the Centre, in July last year, had dispensed with the export release order system till end of 2007-08 season, that expired in September.
Sugar year runs from October to September.
“We have extended the time till October as the government is yet to take a policy decision on the issue,” a senior food ministry official said when asked about the current status of the export release order mechanism. Under the release order system, millers and traders were required to seek prior permission from the food ministry for undertaking export of sugar.
He said the government would take a final view on the matter by October-end taking into account the availability of sugar in the country during the current 2008-09 season, which started this month.
There was no export happening now as crushing has just started in Maharashtra and is yet to begin in Uttar Pradesh.
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The export in the current season is estimated to be 1-1.5 million tonnes as the government has withdrawn the assistance to mills for shipment. The estimated lower output may also dent India’s sugar exports.
For 2008-09, the government has estimated sugar production at 22 million tonnes, but Indian Sugar Mills Association and National Federation of Cooperative Sugar Factories have pegged the output slightly lower at 20 million tonnes.
India is estimated to have produced 26.5 million tonnes of sugar and exported about 5 million tonnes in 2007-08. The country requires about 20 million tonnes of sugar every year for its domestic consumption.