LAHORE: The Pakistan Sugar Mills Association (PSMA) is reaffirming its demand to permit sugar exports, despite the federal minister for national food security’s opposing remarks, calling on the government to deregulate the industry and grant mills greater autonomy in selling their products.
The members of the general body meeting of the association on Monday formally urged the federal government to promptly tackle what they describe as a growing crisis of excess sugar stocks by permitting immediate exports and progressing towards a thorough deregulation of the sector to ensure long-term economic stability. Following the general body meeting, Chaudhary Zaka Ashraf, PSMA Chairman, addressed a press conference at a local hotel, stating that the current disregard from policymakers is inflicting considerable financial damage on both the sugar industry and the public at large. He called on the authorities to halt this detrimental trend and to make decisions that are firmly based in the national interest.
The PSMA’s demand starkly contrasts with the recent comments made by the Federal Minister of National Food Security and Research, Rana Tanveer Hussain, who indicated that there would be no surplus available for export during the current commodity marketing year.
Nevertheless, the PSMA chairman holds a different view. He asserted that Pakistan is currently the sixth-largest sugar-producing country globally, with production exceeding 7.5 million tons this season, indicating that the available supply significantly exceeds the domestic annual demand, thus placing an unnecessary strain on the mills’ storage and liquidity.
The chairman emphasised that Pakistan possesses a massive surplus of sugar that could be strategically exported to various Gulf and Central Asian countries in addition to China and Bangladesh to earn vital foreign exchange for the national treasury at a time when the country’s economy is in dire need of such reserves.
Interestingly, he said, nearly 70 percent of the total sugar production is consumed by the industrial sector for the manufacturing of various goods rather than by individual household consumers, which demonstrates its deep integration and importance to the broader manufacturing economy. Furthermore, the industry contributes to national energy security by producing local power from bagasse, a byproduct that has already facilitated the growth of a balanced steel industry and holds the potential to be further utilised to provide clean energy to other industrial sectors.
Ashraf asserted that the Pakistani sugar industry has the inherent potential to produce up to 13 million metric tons of sugar without requiring any additional capital investment, which would allow for the consistent export of 6 million metric tons annually. Such a strategic move could potentially generate up to 4.0 billion dollars in foreign revenue every year, providing a massive and sustainable boost to the country’s trade balance and overall economy.
Supporting these views, Muhammad Rafiq, central leader and CFO, JDW Group, pointed out that the sugar industry generates over 1,000 billion rupees in annual economic activity and contributes approximately 300 billion rupees in various taxes to the national exchequer every year, making it a cornerstone of the country’s fiscal health. He argued that if the government had followed the industry’s professional advice in a timely manner, there would have been no need for the country to spend precious foreign reserves on importing sugar in previous year.
In addition to seeking export permissions, the association leaders demanded the immediate restoration of the ethanol policy to further diversify the industry’s output and increase its global competitiveness. They maintained that sugar prices are primarily determined by market forces, insisting that it is incorrect to blame mill owners for price hike.
The association concluded by urging the government to end the cycle of restrictive and outdated regulations and allow the industry to operate under a free-market model, which would ultimately provide better prices for farmers, ensure the survival of the industry, and strengthen the national economy through increased exports and tax revenue.
