India on Tuesday imposed sugar export restrictions of 10 million tonnes from June 1 for the first time in six years.
The government said the decision was made to ensure adequate supply and maintain price stability.
“As of June 1, 2022, until October 31, 2022, or until further notice, whichever comes first, the export of sugar is permitted only with the specific authorization of the Sugar Directorate, the Department of Food and Public Distribution and the Ministry of Consumer Affairs, Food and Public Distribution,” a notification read. “The detailed procedure for issuing the necessary permits for the export of sugar will be notified separately.”
However, sugar exports to the European Union and the United States under the CXL and TRQ will continue, according to PTI. A fixed quantity of sugar is exported to these regions within the framework of the quota.
India is the world’s largest sugar producer and the second largest exporter after Brazil. India’s export restrictions would likely increase prices globally.
The country last restricted the export of sugar by imposing a 20% export duty in 2016, the Hindustan time reported.
Tuesday’s decision came at a time when India is set to record its highest ever exports, according to The Indian Express.
In previous seasons, around 6.2 lakh metric tons of sugar were imported in 2017-2018, 38 lakh metric tons in 2018-2019 and 59.60 lakh metric tons in 2019-20. In 2020-21, around 70 lakh metric tons of sugar were exported against the government’s target of 60 lakh metric tons.
However, for the current season, the sugar export contracts up to 90 lakh metric tons have been signed. While about 82 lakh metric tons of sugar have been shipped from the factories and about 78 lakh metric tons of sugar have already been exported.
“The decision will ensure that the closing stock of sugar at the end of the sugar season [September 30] 60-65 lakh metric tons left, i.e. 2-3 months of stocks [monthly requirement is around 24 lakh metric tonnes in those months] required for domestic use,” the Department of Commerce said.
Duty-free import of sunflower oil
In a bid to stem rising prices, the Union Finance Ministry also on Tuesday waived customs duties and agricultural infrastructure development tax on annual import of up to 20 lakh tonnes. metrics of crude soybean and sunflower oil.
The exemption will take effect from Wednesday and will be applicable for this fiscal year (2022-23) and the next (2023-24), the finance ministry said in a notification.
A 15% customs duty and 20% agricultural tax are generally levied on the import of crude edible oils, according to government data
The price of edible oils was a major contributor to soaring retail inflation in India, which hit an eight-year high of 7.79% in April. Among food products, oils and fats recorded the highest inflation rate of 17.28% during the month, according to government data.