Noida, Aug 18 (APAC Media): India is considering reducing or scrapping its 100% import duty on sugar as domestic prices surge to record highs, Bloomberg reported on Tuesday, citing people familiar with the matter.
The proposed move is intended to bolster domestic supplies ahead of the upcoming festival season, when sugar consumption traditionally increases. Government officials are evaluating several options, although no final decision has been taken, the report said.
Ex-mill sugar prices in Maharashtra have climbed to around ₹46 a kg, their highest level on record, according to the Indian Sugar and Bio-energy Manufacturers Association (ISMA).
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Sugar demand in India typically peaks between late August and January, driven by increased consumption of traditional sweets, processed foods and beverages during the festival season.
India, the world’s second-largest sugar producer, rarely relies on imports to meet domestic demand. The last significant purchases from overseas were recorded in 2017-18, according to ISMA data.
The potential reduction in the import duty comes amid growing concerns over global sugar supplies. The El Niño weather pattern has raised the risk of weaker harvests in key producing regions, pushing New York sugar futures to their highest level in about a year.
India is also grappling with weather-related risks to sugarcane production. Monsoon rainfall is currently 13% below normal, according to the India Meteorological Department, after the shortfall exceeded 40% toward the end of June, the first month of the monsoon season. The deficient rains have delayed sowing of some crops.
Sugarcane had been planted across 5.83 million hectares as of Aug. 14, slightly below the area covered at the same point last year, according to the agriculture ministry.
Sugar mills in Uttar Pradesh and Maharashtra, India’s leading sugarcane-producing states, are planning to begin crushing operations 10 to 15 days earlier than usual. The crushing season normally starts in early November.
Meanwhile, the government has imposed stockholding limits on traders in an effort to curb hoarding and mitigate risks to food inflation.
–ENDS–
Disclaimer:Â This article is for informational purposes only and is based on publicly available information. APAC Media is not responsible for investment decisions or losses. Please conduct your own research or consult a financial adviser before investing.
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