ISLAMABAD: The government disclosed on Friday the names of three big sugar mills and said they were responsible for the current crisis and hoarding of the commodity.

The mills are Tandliawala Sugar Mills, Brother Sugar Mills and Kashmir Sugar Mills. According to the statement, the mills have held back 240,000 tons of the government-purchased sugar, creating an artificial shortage in the market.

‘We will take stern action against those mills which did not release the stock purchased by the government,’ Prime Minister Yousuf Raza Gilani told reporters after the launching ceremony of the Benazir Employees Stock Option Scheme (BESOS).

The government, through the Trading Corporation of Pakistan, purchased sugar from mills at Rs 25 per kg and kept it with mills as buffer stock to be released at a time of shortage in the market.

Industry and Production Minister Manzoor Wattoo said that Tandliawala Sugar Mills had held back 78,000 tons of government stocks, Brother Sugar Mills 10,000 tons and Kashmir Sugar Mill 5,000 tons.

‘We are reviewing the situation. We are negotiating with these mills to release the stock,’ Mr Watto said.

A spokesman for the Tandliawala Sugar Mills told Dawn that it had started supplying sugar to the TCP from Thursday.

The prime minister said that after government’s timely action these mills had now changed their intentions to stop the supply. ‘We will not spare anyone who creates artificial shortage in the market.’

Because of the involvement of main political parties in the sugar crisis, the government appears to have avoided action against these mills.

In case of wheat, the government imposed Section 144 of CrPc which led to the arrest of farmers who were reluctant to sell their stock to the government.

The Punjab government has launched an operation against sugar mills to assess the level of boarding. District administrators raided a dozen mills and recovered the hoarded sugar. Meanwhile, the TCP has cancelled a tender to release 15,000 tons of sugar in the open market. The cancellation of tender which was due to be held on Aug 18 has sent negative signals to the market, resulting in price hike.

The TCP said that the decision had been taken to ensure sale of sugar at Rs38 at utility stores.

On the other hand, the government is losing millions of rupees in the shape of GST by charging 16 per cent duty on Rs28 per kg of sugar, while its price has increased to Rs55 per kg in the market. This means that millers in this account are also avoiding GST while paying the tax at much lower level.

Finance Minister Shaukat Tarin estimated the actual price of sugar at Rs35, instead of Rs52 a kg in the market. ‘This price is very high and not acceptable to the government,’ he said, adding that the supply of sugar to utility stores had increased to 70,000 tons from 40,000 tons.