EDITORIAL

According to a newspaper report, quoting an official of the State Bank of Pakistan, it has allowed five sugar mills to import 200,000 tons of raw sugar, so as to bring down sugar prices in the retail markets throughout the country. It will be recalled that the Economic Co-ordination Committee of the Cabinet, in a meeting held two weeks ago, under the chairmanship of the Prime Minister, Shaukat Aziz, had decided to exercise one of the three options to provide relief to the consumers, by allowing duty-free import of 0.2 million tons of raw sugar. It had also authorised the central bank to issue permits for the import of duty-free raw sugar, thereby, making a departure from the past practice. For, as indicated in the news report, under reference, earlier, the Ministry of Commerce used to grant such permission. The official said the central bank had received seven applications in this connection from five sugar mills. The central bank allowed applications, which were received earlier this week, on first-come first served basis. It may be pointed out that, as it had then been explained, ECC was intrigued by the spurt in retail price of sugar, then prevailing at Rs24 per kg, the highest recorded in the last three years.
As for the other two options, which were ignored, these were duty-free import of refined sugar and release of its own stock by the government in the market. Apparently, a safer choice, the other two options were, evidently, left for consideration against any future eventuality. For as the government was reported to have viewed the situation in the midst of abundant availability, it could be remedied with further addition to supplies. However, not satisfied with the ECC decision, in this regard, Pakistan Sugar Mills Association (PSMA) lost no time in urging President Gen Pervez Musharraf to intervene in the matter. Recalling an identical situation only a few years ago, a PSMA spokesman was reported to have said that the ECC decision made it appear that the policy makers were out to appease those with vested interests. It will also be noted that PSMA's resentment over the import of raw sugar appeared to have been caused by the manner it was taken. For as it had been pointed out, neither the sugar producers made any move, in this regard, nor the policymakers deemed it advisable to consult the other stakeholders in the matter. Be that as it may, there can be no disputing the fact that there were hardly any indications of serious shortage of sugar in the market.
For, somewhat belatedly though in Sindh, the mills were reportedly busy with crushing of the new crop of sugarcane. More to it, whatever the extent of idle capacity in the mills, due to short crop or delayed crushing operations, it could be compensated through processing of imported sugar in the raw state. As for the reference made to a previous crisis arising from import of sugar, it will be noted as being simply out of context. For one thing, it was owed, largely, to the opposition from the Minfal, which had described it as being prejudicial to the interest of the sugarcane growers. Moreover, it had viewed it untimely, since the decision for import had been taken quite close to the commencement of the crushing operations. As for the situation now prevailing it bears hardly any resemblance with the past circumstances. Now that the implementation of the ECC decision has started with some sugar mills already allowed to import raw sugar in marked quantities, PSMA should have little to grumble about. It will be in the fitness of things for it to give it a try, hoping that it will work.