17 January 2005	Monday	06 Zilhaj 1425

LAHORE, Jan 16: The import plan of 200,000 ton raw sugar has taken another step towards controversy as the finance ministry (revenue division) has revised rules and definition of what constitutes "raw sugar."

According to a letter issued on Jan 11 by the Central Board of Revenue, sugar of around 600 ICUMSA - a scale on which colour which determines purification of sugar - would be exempted from import duty. Earlier, the standard was 1,000 ICUMSA.

The Pakistan Sugar Mills Association contested the change saying that it would create a crisis in domestic market as it did in 2000. Sugar of over 1,000 ICUMSA is raw material for millers.

They purify it and sell it in the market, whereas sugar with 600 ICUMSA could be directly sold worsening glut in the market. This is a recipe for disaster and will enable the import mafia to escape the PSMA route and take direct control of the market.

The year 2000 witnessed such a exercise and it took next four years to clear the glut created in the market, the millers claim. The commerce ministry, in consultation with millers, had decided that only sugar of 1,000 ICUMSA would be considered as raw sugar.

Now, a subordinate division of the finance ministry has chosen to unilaterally amend the rule. This, they claimed, was either sheer incompetence on the part of the government or deliberate effort to create exit points in policy and create room for corruption.

Earlier, the ministry had also decided to allow only millers' import quota because such type of sugar was a raw material for them. New rules allow anyone and everyone to import the commodity.