ISLAMABAD: Minister for Industries and Production Hammad Azhar will be chairing his first meeting of the Sugar Advisory Board (SAB) on Monday (today) to review price and stock position of sugar in the country.
The meeting has been convened at a time when both the government and PSMA are being held responsible for massive price hike, and unjustified exports with a subsidy of around 3 billion rupees by the Punjab government.
Insiders in the Ministry of Industries and Production (MoI&P) maintain that PSMA has lost its credibility by giving fallacious data and figures at all government fora since 2018-19 and is therefore responsible for the sugar crisis which has led to the formation of an inquiry commission to probe the affairs and wrong-doings of the industry.
In April last year, MoI&P clearly stated that PSMA’s data is not reliable and asked the association to sit with the officials of the Ministry to reconcile it.
The SAB meeting will discuss the following issues: (i) actual production in crop year 2019-20;(ii) carryover stocks from previous year;(iii) expected consumption for crop year 2019-20 ;(iv) expected surplus/ shortage at the end of crop season 2019-20, if any and ;(v) review of prices of sugar.
The retail price of sugar is at Rs 90 per kg. On January 16, 2020, PSMA had clearly conveyed to the MoI&P that ex-mill price should be Rs 80/kg and later on increased its price.
The composition of PSMA Punjab office bearers with Noman Khan as Chairman, Mohammad Rafiq and Ikram ul Haq as Executive members speaks volumes by itself sources said, adding that the Ministry has continuously been kept under pressure by PSMA and has misled the government about the numbers under the influence of one of the office bearer who kept dictating to the others and kept insisting on the continuation of exports despite the fact that in 2019-20 shortages were written on the wall.
An influential group was instrumental in exports to China of 300,000 tons of sugar which proved the last straw on the camel’s back knowing fully well that there would be a shortage in the country, sources further stated.
According to some insiders who have remained privy to private conversations, the office bearers argued that in case of shortage of sugar, the government could always import sugar. This absurd strategy backfired during the crushing season 2019-20 when price of sugar was high and consequently the industry ended up paying extremely high rates for sugarcane as growers were aware that the crop is short; and secondly selling price of sugar was higher so this gave them an opportunity to dictate their terms. This led to the increase in cost of production of sugar and thus the higher rates of sugar.
“The situation could be vastly different, had exports been banned in August or September 2019 which could have kept the price of sugar and sugarcane under control to the advantage of consumers,” the source added.
The highest echelons were urged to ban export of sugar in August 2019 but members of the SAB vehemently opposed the suggestion and the then Prime Minister’s Advisor on Industries and Production Razak Dawood without realizing the gravity of the situation allowed exports to continue on the plea that China has allocated a quota of 0.3 million tons. This point was also raised at a recent meeting of the federal cabinet.
The credibility of one of the members can be judged as he gave the inexplicable undertaking to the government to develop beet in sandy soils of Mianwali to support the poor farmers of the area and maneuvered to get permission from the previous government to produce sugar from beet and later on defrauded the government by setting up a sugarcane based plant in violation of the original permission.
The sources said, Minister for Industries and Production, Hammad Azhar will share the details of discussions at the SAB forum with the ECC and cabinet.—MUSHTAQ GHUMMAN