EGoM May Allow Sugars Exports Of Up to 2 Lakh Tonnes.

 The government is likely to allow sugar exports of up to two lakh tonnes as production this year is set to exceed the domestic demand, official sources said on Monday.

An empowered group of ministers (EGOM) on Food, headed by Finance Minister Pranab Mukherjee, is scheduled to meet tomorrow to discuss allowing sugar exports under the Open General Licence (OGL).

"An inter-ministerial note has been circulated among concerned ministries on sugar export. The agriculture ministry has favoured exports of five lakh tonnes, while the finance ministry has suggested two lakh tonnes," a source said.

The Food Ministry's decision to allow five lakh tonnes of export under OGL but it was kept on hold and it was referred to the EGOM in view of high inflation.

The government had earlier allowed mills to meet their export obligations of about one million tonnes under the Advance Licence Scheme (ALS).

When asked whether government would allow sugar exports under OGL to prevent a situation of cane arrears to farmers, Food Minister K V Thomas told reporters here that the matter would be discussed on Tuesday.

Thomas, however, noted that "the government is presently focusing on bringing National Food Security Act. Exports are not a priority now. Import-export would take place in the normal course".

The representatives of sugar industry bodies Indian Sugar Mills Association (ISMA) and National Federation of Co-operative Sugar Factories (NFCSF) also met Thomas on Monday requesting him to allow exports.

India's sugar production is estimated at 24.5 million tonnes in 2011-12 as against 19 million tonnes in the previous year. The annual demand is pegged at 22 million tonnes.

Agriculture Minister Sharad Pawar had written to Finance Minister Pranab Mukherjee stating that sugar export should be allowed immediately to prevent cane arrears.

"The estimated sugar production of 24.5 million tones (MT) would now be nearly 25 MT, more than the estimated consumption of 22 MT during 2010-11 sugar season. Considering committed exports under the advance license scheme (ALS) of 1.2 MT, there is still a exportable surplus of 1.3 MT in the country," he had said.

"If sugar prices are not stabilised and cash flow to mills are not improved, I fear that we will end up paying a huge subsidy to clear cane payment arrears of farmers," Pawar had pointed out.

Source : ndtv.com