Government likely to extend sugar export subsidies: Pawar
21 Dec 2007
Mumbai: The government is likely to extend freight subsidies for export to domestic sugar for another year beyond April 2008, agriculture minister Sharad Pawar said today.
Mills located in coastal areas get Rs1,350 ($34.25) per tonne for exports while those in interior north receive Rs1,450 per tonne. The subsidies are valid for one year until April 2008.
"We may consider extending it by one more year." Pawar told reporters.
Sugar mills in the country, already saddled with huge stocks, have targeted to export 2.5 million tonnes of sugar in the crop year to September 2008, up from 1.7 million tonnes last year.
Sugar mills in the country, meanwhile, expects to produce 30-31 million tonnes, up from last year's record estimated output of 28.4 million tonnes, according to the Indian Sugar Mills Association.
"Coupled with large stocks of sugar the world over, of which about 60 per cent is believed to be held by India, the Indian sugar industry is today faced with a situation of very high stocks," Pawar said.
India, the world's biggest sugar consumer and the No. 2 producer after Brazil, consumes around 20 million tonnes of sugar annually.
Mills are forced to export the sweetener without profit to trim the huge domestic stocks of around 11-11.5 million tonnes as of October 1, the beginning of the new sugar season.