Sweet profiteering
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The recent turmoil in the sugar market, characterised by soaring prices and a growing sense of discontent among consumers, has cast a stark light on the government's sugar export policy. A few months back, the government played up its decision to allow sugar exports as a means to stabilise the domestic market by increasing production and stimulating economic growth. However, subsequent domestic price increases and the need to import sugar to stabilise prices have exposed the shortsightedness of this approach.
The export policy not only led to a depletion of local stocks but also ignited a price hike that has seen sugar prices surge from Rs159 per kg to Rs170, with experts cautioning that they could soon reach Rs200. This disruption has made life increasingly difficult for most consumers, who are already struggling to pay for other essential commodities as inflation — though much lower than in the last few years - continues to outpace income growth.
The government's earlier justification for exporting sugar was price stabilisation — avoiding a large price dip that might discourage growers. However, the people pushing for exports were not growers, but millers, who are more concerned with increasing their profits rather than stablising domestic prices and supply. Unfortunately, Musadik Malik, one of the only prominent voices to oppose exports, was removed from the Sugar Export Monitoring Committee for his trouble.
There is no excuse for letting supplies run so low that last-minute imports are necessitated. Commercial sugar has a very long shelf life and can easily be stocked well in advance to ensure price stability for domestic consumers while also leaving some stock available for export if international prices rise significantly. This, or any similar approach, would be in the best interests of all parties except profiteers. Unfortunately, agriculture policy has always been less about the people and more about the interests of large landholders and mill owners, many of whom double as parliamentarians and profiteers.
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