Surrendering to sugar barons

Govt must carefully consider impact of allowing sugar exports on market stability and inflation rates

Editorial June 13, 2024


The recent decision of the federal government to allow the export of 150,000 tonnes of sugar has raised concerns and sparked discussions about its potential impact on the local market and consumers. This move, made under pressure from sugar mill owners, comes at a time when domestic retail prices are already high, hovering around Rs160 per kg. Such a decision has the potential to further exacerbate the already soaring prices, leading to increased inflation and financial strain on consumers.

It is worth noting that this is not the first time that such a decision has been made. In the past as well, similar actions have resulted in higher retail prices, adversely affecting the general public. The government must carefully consider the consequences of allowing sugar exports, especially in the light of the potential impact on local market stability and inflation rates.

Furthermore, the conflicting statements from government officials regarding the decision to export “surplus” sugar have only added to the confusion and concerns. The denial of such a decision by the commerce minister while speaking on the floor of the National Assembly, followed by reports of the decision being made, raises questions about transparency and accountability in policymaking.

At the crux of this issue is the need for a balanced approach that takes into consideration the interests of both sugar mill owners and the general public. While addressing the surplus production of sugar is important, it should not come at the expense of burdening the inflation-stricken consumers with higher prices. For all the mill owners’ assurances that they will maintain sufficient stocks to stablise local prices, similar promises have regularly been made and broken for decades.

For all of the government’s big claims, we cannot ignore the fact that last year’s sugar crisis was triggered by a similar decision to allow sugar exports, allegedly to benefit sugar barons in the PML-N and PPP, just as the PTI government allowed exports to benefit its own sugar barons. Even if the recent approval for export is above board, there is no question about who the biggest beneficiaries will be.

We must also ensure that the caretaker government’s wheat import-export fiasco is not repeated — the government imported too much based on bad estimates for local output, creating a domestic oversupply that caused depressed prices and losses for local farmers and the government. Commodity export decisions must be made while ensuring the stability of the local market and protecting consumers from the adverse effects of such policies.


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