Govt Decides to Fully De-Regulate Sugar Sector

The federal government has decided in principle to deregulate the sugar sector, with a formal proposal expected to be presented to Prime Minister Shehbaz Sharif next week, sources in the Ministry of Industries and Production told ProPakistani. Under the proposed plan, the government will withdraw from direct market intervention, except for maintaining a strategic buffer stock of 500,000 tons of sugar, equivalent to one month’s national consumption, through the Trading Corporation of Pakistan (TCP). Sources explained that the final draft is being prepared in consultation with industry stakeholders. The deregulation is aimed at stabilizing the market, boosting production, and promoting exports. According to the draft proposal, if deregulation fails to stabilize prices, the government may increase the volume of the Benazir Income Support Program (BISP) to shield consumers. The plan also suggests that allowing sugar exports during surplus periods would help farmers secure better prices for sugarcane. To enhance production, the proposal includes running sugar mills at 50 percent to 70 percent capacity, to add up to 2.5 million tons of additional sugar. If achieved, this could enable sugar exports beyond domestic needs and generate up to $1.5 billion in foreign exchange annually. The private sector will handle all sugar transactions except the strategic buffer maintained by TCP, sources added.