ISLAMABAD, Sept 5: The national kitty suffered a loss of Rs10 to Rs12 billion this year owing to delayed offloading of sugar stocks lying with the Trading Corporation of Pakistan (TCP), besides it deprived consumers of cheap sweetener, it is learnt.

The carrying cost of sugar, which includes storage expenses and banking charges, is 40 paisa per kg per month. The average price of sugar with the TCP in July 2006 was Rs38.5 per kg which now has increased to Rs43 per kg.

The loss to the national exchequer accrued due to price differential between the retail rate of Rs26 per kg at the utility stores as against the current actual import cost of sugar, i.e. Rs43, which leaves a yawing difference of Rs17 per kg.

This means that the price differential was the actual cause of loss to the national kitty which is being financed by the government. The sugar mills have already stopped government from selling sugar in the open market to reduce the loss on imported sugar.

An official told Dawn on Wednesday that the TCP stock stood at 345,000 tons till Aug 16, 2007. The total sugar imported by the TCP in the year 2006 stood at 900,000 tons from international market to stabilise sugar price in the market.

The government will suffer a loss of Rs5.8 billion on the sale of remaining TCP stocks at utility stores, if the price remains the same in the upcoming months. This means that by each passing months this loss will increase further.

The current average price of sugar across the country is Rs29-31 per kg in the open market.

The government had agreed with the millers that the TCP would not release costlier sugar stock in the open market but could only sell it through the utility stores. The TCP only sells 30,000 tons per month to utility stores to provide subsidised sugar in selected cities.

On the other hand, an official said Pakistan had suffered an additional financial burden of about $200 million because of delay in sugar import to meet its annual consumption of four million tons.

In October 2005, the average price of sugar was less than $300 per ton in international market but the price rose to over $500 per ton at the time of importing sugar in the year 2006 from international market.

This additional cost accrued due to delayed decision of the government to import sugar for meeting the local demand.

According to the official, the delay in policy decision to offload sugar stock from the TCP and timely import of sugar from international market led to billions of rupees loss to the national kitty.