Sugar reforms

Published December 21, 2021

THE sugar sector reforms suggested by a ministerial panel last week can be a major leap towards deregulation of the sweetener’s trade. But, at the same time, the proposed reforms underscore the predicament of the Imran Khan administration. It wants the government to get out of the sector and yet it has been reluctant to recommend its complete withdrawal from the market. The ruling party’s hesitancy is understandable given the political nature of the commodity with the involvement of millions of cane growers across Punjab and Sindh as well as influential political families straddling the party divide. The financial interests of the bureaucracy in continuing its hold over the sector is another obstacle towards complete deregulation of sugar trade in the country. The panel — the Sugar Sector Reform Committee — was formed by the government of Prime Minister Imran Khan in the wake of an extensive federal inquiry against the sugar factories and is supposed to look into different aspects of the commodity’s trade following the 2019 winter shortages that led to a swift price hike. Most of the suggestions put forward by the committee after one and a half year of deliberations have been on the table for long and require a major shift in policy. But no government has dared to implement them for fear of a political backlash from the growers and factory owners.

For example, the proposal to end the support price for the sugar cane crop will not be liked by the big growers who have a strong presence in parliament. Likewise, the suggested changes in the provincial laws to put an end to crop zoning to give growers the option to decide what to grow and what not to will be frowned upon by mill owners. The abolition of the Sugar Factories Establishment and Enlargement Act, 1966, to allow anyone to set up a sugar mill to break the cartel of the factory owners will also not sit well with the wealthy millers. These are all steps towards deregulation of the sector and the improvement of its governance. But the proposals to allow sugar import while controlling the export of surplus or imposition of fines on delays in crushing etc. show that the government is still not ready for a totally deregulated sector. Still, the panel’s recommendations can be the first step towards reducing sugar price volatility and deregulating the market in the country.

Published in Dawn, December 21st, 2021

Opinion

Editorial

Sustainable path?
13 Jun, 2026

Sustainable path?

THE FY27 budget is the first clear signal that the government is ready to transition from stabilisation to growth ...
Prioritising education
13 Jun, 2026

Prioritising education

THOUGH the improvement in the country’s literacy rate may be slight, as highlighted by the Economic Survey, it ...
Poverty’s rise
13 Jun, 2026

Poverty’s rise

AS attention turns to the government’s plans for the coming fiscal year, one set of figures deserves particular...
A difficult story
Updated 12 Jun, 2026

A difficult story

Unless productivity becomes the dominant target of economic policy, Pakistan will continue to oscillate between crises and fragile recovery.
Rough waters
12 Jun, 2026

Rough waters

AMONGST the key potential triggers for fresh conflict in South Asia is water. The Indian state is behaving in an...
Politicised football
12 Jun, 2026

Politicised football

ALMOST three-and-half years since Lionel Messi led Argentina to FIFA World Cup glory, the latest edition of...