India shows green signal for sugar export to EU.

NEW DELHI: India has shown green signal for the export of 10000 tons of refined sugar to European Union, which was halted for three months due to fall in production, under some restrictions.

The Directorate General of Foreign Trade (DGFT) has given the permission to resume the export in the wake of better production outlook and the stable prices of sugar in the domestic market.

The exports will be undertaken by trading firm Indian Sugar Exim Corporation during 2009-10 season ending September.

The government was forced to stop sugar export in February due to the strong objection from the opposition parties as the domestic prices spiraled sharply driven by deficiency of the sweetener.

Though sugar prices have dropped significantly to Rs 32 a kg, the exports to EU would be matched by equivalent quantity of imports from anywhere in the world to ensure that domestic supply is not disturbed.

India enjoys duty-free exports to EU up to a fixed quantity under a ‘preferential quota’ arrangement. Even though the country had faced shortages, the government wanted to ensure that the EU preference is not taken away if no sugar was despatched.

Source : Commodity Online