Pakistani Millers Oppose Import of Indian Sugar.

Pakistani millers oppose sugar imports from India because of fears New Delhi may dump surplus product and hurt the domestic industry, an industry official said on Wednesday.

Pakistan imposes no import duty on White sugar and the government in September waived a 25% duty on raw sugar. This was to encourage the private sugar sector to import sugar to meet feared shortages after August flood damage reduced the 2010/11 crop to 3.2 million tonnes.

But government and industry officials now expect production of between 3.7 and 3.8 million tonnes, and millers say that with the imported stocks of roughly 400,000 tonnes, there should be enough to meet domestic demand.

Pakistan consumes about 4.2 million tonnes sugar a year.

"The country has sufficient stocks to meet demand and there is no need to import sugar at this stage," Javed Kayani, chairman Pakistan Sugar Mills Association (PSMA) told Reuters.

"The government should not allow sugar imports from India, which has surplus sugar and wants to dump it in the Pakistani market," he said.

India's sugar output is expected to rise by 12% to 11.2 million tonnes through January 31 when the current season, which began October 1, ends, said the Indian sugar association, raising hopes of overseas sales.

Despite millers' reservations, the government wants the private sector to import sugar to help build sufficient reserves to meet any shortages.

"The government would like to maintain strategic stocks of about 700,000 tonnes," a senior government official told Reuters while requesting anonymity because he was not authorised to speak to the media.

He said overland imports from India would be "most profitable" because of lower freight costs.

Pakistan bought about 1.2 million tonnes of sugar last year after production fell to nearly 3.1 million tonnes from the 2009/10 crop, when many farmers switched to more profitable crops.

Source : moneycontrol.com