Govt unlikely to tax sugar imports in 10-15 days: Pawar.

The government is unlikely to impose an import tax in the next 10-15 days on overseas purchases of sugar as global prices of the sweetener are on the higher side, Farm Minister Sharad Pawar said on Monday.

"I am not ready to take a decision immediately," Pawar said.

India, the world's top sugar consumer, last year withdrew a 60% import tax on white, or refined, sugar as output fell 44%.

On Monday, raw sugar futures traded around seven-week highs, underpinned by a view that physical refined sugar supply was tight, as reflected by high whites-over-raws premium.

India's sugar season runs from October to September.

Mills favour at least a 40% tax on overseas sugar purchases as it would help arrest a slide in local prices and also help them to pay a good price to cane farmers who would be encouraged to plant more crops.

Pawar said a panel of ministers would decide on the levy sugar quota or quantity mills sell at subsidised rates to the government for sale through the public distribution system.

India's food ministry favours a 20% cut in the sugar allocation to public distribution schemes as the supply scenario has improved.

"We favour a 16 percent allocation instead of (current) 20%," Pawar said.

Industry body The Indian Sugar Mills Association estimated the country's sugar supply at 27.4 million tonnes in the current year against consumption of 22.5 million tonnes.

Sugar stocks in India, the world's top producer behind Brazil, at the end of the current year in September could be 4.9 million tonnes, the trade body said.

Opening stocks were 4.4 million tonnes at the start of the season in October, said M.N. Rao, ISMA's deputy director general.

Source : Moneycontrol.com