Latest news with #Rs165
Express Tribune
a day ago
- Business
- Express Tribune
Govt warns of action against sugar overpricing
Listen to article Federal Minister for National Food Security and Research Rana Tanveer Hussain has said that the government will initiate a countrywide crackdown against the mills involved in hoarding, profiteering or overpricing, if the Pakistan Sugar Mills Association (PSMA) failed to play its due role in ensuring compliance with the notified price among its members. Rana Tanveer chaired a high-level meeting on Tuesday with representatives of PSMA, provincial agricultural departments and key stakeholders from across the country. The meeting was convened to review the current sugar price situation and compliance with the government's notified ex-mill rate of Rs165 per kilogramme. The minister expressed grave concern over reports that several sugar mills were not complying with the fixed price and were contributing to artificial inflation in the market. He categorically said that the government would not tolerate such manipulation of the market, which places an unfair burden on the common man. He issued a strict warning, stating that if the association failed to play its role in ensuring compliance among its members, the government would be compelled to initiate a countrywide crackdown. The minister emphasised the need for transparency and fairness in the sugar supply chain. He also asked all provincial governments to provide detailed compliance reports within 24 hours and enhance monitoring at the district level to curb any illegal practices by mill owners. He stated that the food security ministry would work in close coordination with the relevant enforcement bodies including the Federal Board of Revenue (FBR) and provincial food authorities to take legal action against violators. Rana Tanveer reiterated the government's commitment to protecting the rights of consumers and maintaining price stability in essential commodities. He urged all stakeholders to act responsibly and cooperate fully with the government to ensure smooth supply and fair pricing of sugar across the country.
Express Tribune
2 days ago
- Business
- Express Tribune
Retailers halt sugar sales over price dispute
The Kiryana Merchants Association announced on Tuesday a province-wide suspension of retail sugar sales in protest against recent government crackdowns, including raids, arrests, shop closures, and hefty fines imposed on shopkeepers. Starting Tuesday, retailers had ceased sugar sales until a fair and sustainable pricing mechanism is established. The announcement was made by Hafiz Arif Gujjar, Central President of the Association, and Saleem Parvez Butt, President of the Association's Rawalpindi Division. In the wake of the retail suspension, sugar is reportedly being sold on the black market at up to Rs220 per kilogram in urban centers and surrounding areas. Retailers, in an effort to avoid penalties, are now limiting sugar sales to known customers and local hotels, bypassing walk-in consumers. The Association leaders voiced strong objections to the government's pricing directives, highlighting the discrepancy between the official retail price of Rs165 per kg and the actual wholesale rate of Rs176-178 per kg set by sugar mills. They argued that it is economically unviable for small retailers to purchase sugar at such high prices and then sell it below cost. "We are being asked to sell sugar at Rs173 per kg while purchasing it at Rs176 or more. The government has arbitrarily set an Rs8 profit margin based on an unrealistic wholesale rate that mills don't follow," the Association stated. Despite informing the authorities about these pricing inconsistencies over the past two weeks, the Association said the government responded with punitive actions instead of addressing the supply issues. Shops were sealed, retailers fined, and arrests made — measures the Association deems unjust and unsustainable. Leaders further alleged that sugar mills, brokers, and dealers — many with political connections — continue to operate without restriction, supplying sugar above the official rates, while small shopkeepers are being disproportionately targeted by administrative enforcement. Reaffirming their commitment to dialogue and reform, the Association expressed a willingness to engage in negotiations and work toward a long-term pricing solution. While they are open to reducing their profit margins, they emphasised that selling at a loss is not a viable option. As part of the protest, the Association has directed all member retailers to immediately deplete their existing sugar inventories and halt new sales. Meanwhile, enforcement actions have escalated across the Rawalpindi Division, which comprises Rawalpindi, Attock, Jhelum, Chakwal, Murree, and Talagang. Authorities have issued challans to 127 shopkeepers for allegedly overpricing sugar, levying fines ranging from Rs20,000 to Rs25,000 per shop. Additionally, 59 retail outlets have been sealed, and several sugar stockpiles seized from warehouses. The Association has issued a final warning: if intimidation and penalties continue, they will escalate their protest into a complete strike of all grocery shops throughout Punjab.
Business Recorder
3 days ago
- Business
- Business Recorder
Sugar price hike: NA panel to identify ‘beneficiaries'
ISLAMABAD: The National Assembly Standing Committee, headed by Jawed Hanif Khan, on Monday decided to investigate the reasons behind the exorbitant increase in sugar prices in the local market, its export and import patterns, and identify the actual beneficiaries of this cycle. 'The entire episode of the sugar crisis is suspicious. It must be investigated, and criminal proceedings should be initiated if any wrongdoing is found,' said Chairman Jawed Hanif Khan. The Committee also formed a sub-committee to probe the price surge, focusing on sugar exports followed by duty- and tax-free imports—measures allegedly designed to benefit certain actors. The chairman remarked that there appeared to be a nexus among politicians, bureaucrats, and the sugar industry. Members of the Standing Committee — both from the treasury and opposition benches —supported the formation of a special panel to scrutinize the entire sugar supply chain and its beneficiaries. Relevant ministries, organizations, and departments will be summoned for this purpose. PSMA agreed for ex-mill price of sugar at Rs165/kg, ministry says Commerce Ministry's team headed by Additional Secretary, Salman Mufti presented updated status of previous recommendations of the Standing Committee. During the meeting, the Ministry of Commerce presented an overview of its upcoming Trade Policy and the basis for its ambitious export target of $60 billion by 2029. The presentation was met with strong criticism, particularly from PML(N) MNA Shaista Pervaiz Malik, who questioned the feasibility of such a target in light of high energy costs and foreign exchange issues that have forced many industries to shut down. In response to a query by MNA Khurshid Ahmed Junejo, Director General (Trade Policy) Shafiq A. Shehzad admitted that the Commerce Ministry has never achieved its export targets. However, he noted that exports have increased by approximately $5 billion annually in recent years. He also highlighted key challenges such as limited export surplus, lack of competitiveness, and the effects of climate change. Shehzad emphasized that the government had decided to pursue an export-led growth strategy, acknowledging the risks but citing the success of other countries that had adopted similar policies. His views were echoed by the Chief Executive of the Trade Development Authority of Pakistan (TDAP), who shared future plans to boost exports. According to the Ministry of Commerce, Pakistan faces several hurdles in enhancing exports, including: (i) U.S. tariffs and their impact on Pakistani exports; (ii) disruptions in global trade; (iii) decline in domestic crop production (eg, cotton down 30%, maize and cotton 15.4%, rice 1.4%); (iv) slowdown in global commodity prices (eg, sesame seeds, rice), and (v) financial constraints due to limited export financing. Addressing concerns about the US tariffs, Joint Secretary (Tariff) Muhammad Ashfaq—who was part of the recent Pakistani delegation to Washington—said that tariff issues could potentially be resolved through negotiations. The Committee was also informed that Secretary Commerce Jawad Paul had returned from the U.S., where he had accompanied Finance Minister Senator Muhammad Aurangzeb in discussions with American trade representatives. Paul is currently briefing civil and military authorities at the Prime Minister's Office. On the issue of car imports, the Joint Secretary (Trade Policy) clarified that while the import of new cars is allowed—with Regulatory Duty (RD) reduced by 50% on high-value vehicles and by 33% on smaller ones—the government has no plans to allow the import of five-year-old used cars. He added that the Ministry of Industries and Production is working on a new auto policy, set to take effect from July 1, 2026, which will address quality and regulatory issues. Regarding the Trading Corporation of Pakistan (TCP), the Committee adopted recommendations of Sub-Committee headed by Khurshid Ahmed Junejo which include payments to TCP as per agreements between government entities. However, it did not support TCP's request for an exemption from the special audit of loans raised from banks, as the audit had been requested by the Finance Division. 'Since the Finance Division has demanded the special audit of TCP loans, this matter needs to be discussed with them. The Committee does not support an exemption,' said Chairman Jawed Hanif Khan. Copyright Business Recorder, 2025
Express Tribune
4 days ago
- Business
- Express Tribune
Sugar, power and patronage
In the digital age, there's no excuse for opacity as a transparent digital dashboard that tracks sugar from mills to wholesalers to retailers would make it harder for hoarders and profiteers to operate undetected. Photo: file Listen to article Pakistan's recurring sugar crises have become a telling reflection of how entrenched elite interests continue to manipulate the economy under the guise of policy. The latest surge in sugar prices, now hitting between Rs180 and Rs210 per kilogramme despite official claims of intervention, shows just how far removed state actions are from public welfare. What is unfolding isn't simply mismanagement. It's a system that protects the powerful and punishes the public. In July 2024, the federal government announced with much fanfare that it had reached an agreement with sugar mills to sell sugar to wholesalers at Rs165 per kg. This was framed as a breakthrough deal. But within days, the mills began violating the agreed price, resuming supply at Rs175, not Rs165. Even at inflated rates, sugar remains scarce in wholesale markets. The public, meanwhile, continues to pay well over Rs200 per kg in major cities like Karachi and Lahore. This was not just a policy failure. It was the illusion of reform – an orchestrated move to deflect public outrage without touching the roots of the problem. And at the root lies one uncomfortable fact: the sugar sector is not regulated by the government. It is effectively governed by itself. The concentration of political and economic power is stark. The Sharif family, which sits at the core of the current ruling coalition, owns major sugar mills. That the same actors who draft economic policies also control production and pricing of sugar reveals a conflict of interests so blatant that it no longer shocks. This overlap turns policy into patronage, and governance into a tool for private gain. Earlier this year, the government allowed sugar exports even as domestic stocks were under pressure. Predictably, local prices soared. Then came the tax-free import of 500,000 metric tons of sugar; a move that drew criticism from the International Monetary Fund, which questioned both its timing and its lack of transparency. No one has explained who received import licences, under what conditions, or how the decision was justified while government revenues continue to bleed. What the country witnessed was a two-way windfall: profits made on the export side and further gains through duty-free imports. Also there is an issue of price collapse when the shipments arrive in November; around the time sugar mills will be buying from growers, giving them leverage to manipulate buying prices. Throughout all this, regulators have remained silent. The Competition Commission has issued no inquiry into possible cartelisation. The Federal Board of Revenue (FBR) has not released any audits on sugar mill compliance or tax contribution. No action has been taken against mills for openly breaching their agreement with the government. When institutions with legal mandates refuse to act, the market ceases to be a marketplace. It becomes a racket. This isn't new. But it's become more brazen. The previous PTI-led government also faced sugar price hike in 2020. However, its response was markedly different. Then prime minister Imran Khan ordered a wide-ranging inquiry, involving the FIA, SECP, FBR, and other agencies. The investigation looked into hoarding, tax fraud, price manipulation, and the misuse of subsidies. Importantly, it didn't shy away from naming allies or investigating politically connected individuals within PTI itself like Jahangir Tareen. The inquiry report was published in full. While it triggered backlash, it also marked a rare moment where the state asserted its regulatory role over an entrenched industrial elite. The investigation was abandoned and charges dropped when the PTI government was removed. What we are seeing now is the opposite. Instead of confronting the sugar mafia, the current government has aligned itself with it. Instead of enforcing transparency, it has shielded its members from scrutiny. At every step, decisions have served the interests of the few at the expense of many. This has real human costs. Sugar is not just a luxury good. It is a daily essential for households and a critical input for small businesses. Rising sugar prices drive up food inflation, burden already stretched family budgets, and hurt bakeries, tea stalls, and street vendors across the country. When a government facilitates price spiral through weak enforcement and preferential trade decisions, it doesn't just fail the economy. It abandons its moral claim to serve the people. To fix this, Pakistan must first acknowledge that the sugar crisis is not a temporary market blip. It is a symptom of a deeper structural disease: the collusion between political elites and monopolistic interests. The solution begins with cutting these links. Public officeholders, and their immediate families, must be barred from owning or profiting from industries they are in a position to regulate. This principle is basic in any functioning democracy. Without it, policy becomes an instrument of personal enrichment, not public service. Next, regulatory institutions must be depoliticised and empowered. Agencies like the CCP, FBR, and SECP should have independent boards, professional leadership, and the authority to publish findings without seeking ministerial approval. If sugar mills are in violation of tax laws or pricing agreements, the public has a right to know. Trade policy must also be demystified. Export and import decisions, especially for essentials like sugar, should not be made behind closed doors. They must be based on evidence, presented in parliament, and subjected to public scrutiny. Import licences should be granted through open bidding, and their recipients disclosed proactively. In the digital age, there's no excuse for opacity. A transparent digital dashboard that tracks sugar from mills to wholesalers to retailers would make it harder for hoarders and profiteers to operate undetected. It would also empower consumers and watchdog groups with real-time data. Finally, subsidies and tax exemptions must be subjected to rigorous review. No tax waiver or import concession should be granted without a clear, documented public interest rationale. Otherwise, they will continue to be used as vehicles for elite enrichment. The sugar industry has become a symbol of how deeply elite capture runs in Pakistan. But it can also become a turning point. If the state can confront the sugar mafia – not with hollow deals but with real accountability – it can begin to rebuild public trust and economic fairness. If it cannot, the crisis will return. Prices may dip briefly, but the profiteering will continue. This is not just about sugar. It is about who the system is designed to serve and who it leaves behind. The writer is a graduate of the University of British Columbia
Express Tribune
17-07-2025
- Business
- Express Tribune
Govt signs fresh sugar export deal
Listen to article The finance ministry on Wednesday finally admitted that the International Monetary Fund (IMF) objected to Pakistan's tax exemptions on sugar imports. Despite this, the government has entered into yet another agreement with the Pakistan Sugar Mills Association (PSMA), allowing future sugar exports if total stocks exceed seven million metric tonnes. The new agreement, signed on July 14 between the minister for national food security and research and the all-powerful PSMA, aims to persuade millers to keep ex-factory sugar prices between Rs165 and Rs171 per kilogram until October 15. It signals that the government has not learnt from its earlier decision to allow the export of 765,000 metric tonnes, which triggered the current price crisis. Prime Minister Shehbaz Sharif's government had permitted the export of 765,000 metric tonnes, driving local prices up to Rs200 per kg. In order to stabilise prices, the government allowed tax-free imports of sugar, prompting sharp criticism from the IMF. "The government is discussing the sugar issue with the IMF," said Secretary Finance Imdadullah Bosal at a National Assembly Standing Committee on Finance meeting held Wednesday. PPP's Syed Naveed Qamar chaired the committee also said that the IMF was displeased with the government's decision to waive taxes on the import of sugar. "There are about 70 benchmarks in the IMF programme, and one of those is that tax exemptions cannot be given," Bosal explained, responding to a question on the nature of the IMF objections. Sources said that the IMF has plainly asked the government to revoke three statutory regulatory orders issued to waive taxes. The Express Tribune reported on Tuesday that the IMF had reacted to the major breach of the $7 billion programme and conveyed its reservations about import of sugar by waiving taxes in violation of written commitments. Federal Board of Revenue (FBR) Chairman Rashid Langrial justified the tax waiver by pointing out that total import duties on sugar amounted to 53%, making imports unaffordable. The waiver aimed to cut the import price of sugar by Rs82 per kg. Initially, the Trading Corporation of Pakistan (TCP) issued a tender to import 300,000 metric tonnes. After IMF's objections, the volume was reduced to 50,000 tonnes, and the bid deadline was extended from July 18 to July 22. MNA Jawed Hanif criticised the double standard, saying the government used the IMF as an excuse during budget debates but later breached the agreement itself. Bosal denied speculation that the IMF would demand new taxes on salaried individuals in exchange for sugar import waivers. PPP's Nafisa Shah remarked, "Vested interests are stronger than the IMF." The sugar export agreement states that "the federal government will allow, for export of sugar stocks exceeding seven million metric tonnes (carryover plus 2025-26 production), after 30 days of the closing of the crushing season 2025-26." This definition means even imported sugar, if not consumed, could count toward total stock. The stock verification will rely on FBR's track and trace system and be overseen by a four-member committee, one official each from the federal and provincial governments and two from PSMA. Critically, the agreement includes a price-fixing clause that contradicts Competition Commission of Pakistan (CCP) laws. It states, "The maximum ex-mill price of sugar will be fixed at Rs165 per kg on July 15, 2025, and increased by Rs2 per kg monthly until October 15, 2025." Before last year's sugar exports, ex-mill prices were below Rs140 per kg. By setting the maximum price at Rs171 per kg, excluding retail profit margins, the government is effectively granting a windfall to millers. Qamar said the government should exit the sugar trade entirely, including ending the licensing regime for new sugar mills. "There are sufficient stocks in the country," Qamar added. "Importing sugar sends the wrong signals to the market." He further said the government should only regulate wheat, not sugar. "Sugar remains a highly regulated commodity, while wheat has been deregulated," he said. Other matters The committee also reviewed two key private member bills: the Corporate Social Responsibility (CSR) Bill, moved by Nafisa Shah, and the Parliamentary Budget Oversight Bill, proposed by MNA Rana Iradat Sharif Khan. The CSR bill proposes that companies contribute 1% of net income toward social welfare. However, the secretary finance opposed the bill, claiming it would raise the cost of doing business. Committee members rejected this argument, noting the levy targets net income, not sales. Nafisa Shah argued that many companies already allocate around 1.5% to CSR voluntarily and support the bill. Despite this, the finance ministry requested a one-month consultation period with stakeholders, which the committee said was unnecessary. Qamar also formed a sub-committee to further evaluate the Parliamentary Budget Oversight Bill, aimed at enhancing budgetary accountability. While Secretary Bosal expressed reservations against the bill, Qamar stressed that while the oversight bill may challenge the bureaucracy's fiefdoms, the proposed legislation is important for the improvement of the overall system.
