Pakistan: No subsidy or tax exemptions for sugar imports

Islamabad: The Economic Coordination Committee (ECC) of the Cabinet has reaffirmed its stance and made it clear that no subsidies or tax exemptions will be provided for sugar imports during the 2025–26 financial year, reported Business Recorder.

The Finance Ministry conveyed this stance firmly, citing the country’s financial position and commitments made to the International Monetary Fund (IMF).

Amid concerns over sugar supply and rising prices, the Ministry of National Food Security and Research (MNFS&R) sought urgent approval on June 27 from ECC Chairman and Finance Minister to present a summary. The request was approved, as per the news report.

The MNFS&R informed the ECC that the Prime Minister’s Committee, formed on March 16 under the Deputy Prime Minister, had met on June 19 and reviewed the ongoing situation. The committee observed that sugar prices remained high and existing stock levels were not sufficient to stabilise the market. It concluded that the only way to ease inflationary pressure in the sugar sector was to increase supply.

Despite repeated requests, sugar millers have refused to lower ex-mill prices. Consequently, the committee recommended importing up to 500,000 metric tons (0.500 MMT) of white sugar.

Consultations with sugar dealers and provincial officials revealed that the tight supply and increasing demand are creating space for hoarding and price manipulation. Based on current trends, sugar prices could climb as high as Rs.190 per kg at the ex-mill level and Rs.200 per kg at retail by November 2025.

To prevent this surge, the MNFS&R proposed importing white sugar.

The ministry also proposed forming a Steering Committee to manage the process, including logistics, pricing, and distribution. The committee would include the Federal Ministers for Food Security and Commerce, the Special Assistant to the Prime Minister on Foreign Affairs, secretaries of key ministries, the FBR Chairman, provincial Chief Secretaries, and the Chairman of the Trading Corporation of Pakistan (TCP).

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