The government on Wednesday announced permitting 500,000 tonnes of sugar under the open general license (OGL) within the next 10 days. The announcement comes as sugar production in the current year is expected to be around 25.5 million tonne which is expected to leave the country with a surplus availability of around eight million tonnes during the year.
“There has been considerable demand from the industry as well as farmers to allow exports under OGL. We appreciate that any export in near future will get rich dividend considering the international prices”, Food and Agriculture Minister Sharad Pawar said at the annual general meeting of the Indian Sugar Mills Association. Pawar added that the shipments will have no impact on domestic retail prices.
The minister also announced hike in levy sugar price for the ongoing sugar season at Rs 18.47 a kg as against Rs 17.57 a kg in the previous season. This will benefit millers who will have to bear lesser burden by meeting levy sugar obligations for the public distribution system. The government buys levy sugar form mills for supply to ration shops.
Government had earlier permitted sugar exports against the pending Advanced Authorisation Scheme (AAS) and Advance License Scheme (ALS) obligations, under which the mills are required to meet an equivalent export obligation for imports in the previous year.
The government had allowed the export of about 1.5 million tonnes of sugar through the ALS recently.
Pawar said that industry has applied only around half of the total exports permitted under this scheme.
“In order to further maximize our returns a first tranche of exports of around 500,000 tonnes under OGL will also be permitted”, Pawar said.
However, Pawar added that further orders of exports will depend on the level of production. “We will link our exports with production and the department will work out modalities within the next 10 days . We will ensure that the opportunity for availing the benefits of exports is accessible to all sugar mills”, pawar added.
