Islamabad, Feb 12: Pakistani government is facing difficulties in persuading sugar millers to reduce prices ahead of Ramazan, as industry leaders remain firm on their stance. Despite the government’s efforts, millers have shown little interest in lowering rates, according to sources.
Currently, sugar is being sold at Rs155 per kg, while the government aims to bring it down to Rs120 per kg. However, millers argue that the actual production cost stands at Rs170 per kg, making it unfeasible to sell at the proposed lower rate.
To make sugar more affordable, millers have suggested that the government eliminate the 18% General Sales Tax (GST) on the commodity. They claim that removing the tax is the only viable way to reduce sugar prices by Rs25 per kg.
Adding to the complexity, a significant number of sugar mill owners are currently in Dubai, delaying negotiations. The government has urged the millers to provide a final response regarding the price adjustment by Friday.
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Meanwhile, the provincial governments have not set a support price for sugarcane this year due to conditions imposed by the International Monetary Fund (IMF), further complicating the situation.
In a surprising development, Pakistan’s sugar exports to Afghanistan have skyrocketed, marking an unprecedented increase of 4,332% during the first seven months of FY 2024-25. Official figures reveal that from July to January, sugar exports to Afghanistan surged to $262.68 million, a massive leap from $5.93 million recorded in the same period last year.
This remarkable growth of $256.76 million year-over-year (YoY) has positioned sugar as the leading contributor to Pakistan’s total exports to Afghanistan.
The rising export figures and ongoing price disputes highlight the challenges the Pakistani government faces in stabilizing the local sugar market ahead of the holy month. With Ramazan approaching, consumers remain hopeful for price relief, but whether the government can secure a deal with millers remains uncertain.
