Nepal | March 30, 2020

Quantitative restriction on sugar import lifted

Himalayan News Service

Kathmandu, July 18

The quantitative restriction on sugar import has been lifted with the government deciding not to extend quantitative restriction on sugar import beyond the end of fiscal year 2018-19, said Dinesh Bhattarai, spokesperson for the Ministry of Industry, Commerce and Supplies.

In a bid to limit excessive supply of cheaper foreign sugar in the domestic market, which had lowered the demand of comparatively costly Nepali sugar, the government had fixed a quota on sugar import in September. While the restriction was initially in place only till mid-April, the government had extended the limit by three months to the end of fiscal 2018-19 under pressure from sugar mill operators.

The restriction barred traders from importing more than one lakh tonnes of sugar during the last fiscal. Now, traders can import any quantity of sugar.

Though lifting the quantitative restriction on sugar import will ensure that Nepali consumers will have access to imported sugar, especially from Pakistan and India which is cheaper compared to domestic sugar, sugar mill operators have criticised the government for not extending the quantitative restriction. They have urged the government to extend such restriction on sugar import for at least three months so that sugar mills can clear the stock of Nepali sugar.

“Sugar mills collectively have almost one lakh tonnes of sugar in stock, which will cater to the domestic demand of the sweetener for at least four months,” said Sashikanta Agrawal, chairman of Nepal Sugar Producers Association.

Informing that the crushing of sugarcane will also begin within a few months, the government should have first calculated the actual demand of sugar in the ongoing fiscal year and allowed import of sugar as per necessity, he said.

According to him, Indian sugar is available at almost Rs 55 per kg in the Indian retail market and factory price is even cheaper. “Availability of such low cost sugar in the domestic market will lower the demand for Nepali sugar whose production cost is high,” added Agrawal.

Currently, the domestic sugar retails at Rs 78 per kg.

The government had imposed quantitative restriction on sugar import to ensure that sugar mills clear their stock and issue pending dues to sugarcane farmers. However, the government does not seem to be in the mood to continue with the restriction as sugar mills still have not cleared millions they owe to cane farmers.


A version of this article appears in print on July 19, 2019 of The Himalayan Times.

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