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November 22, 2020

Punjab govt cancels import of 25,000 metric ton sugar

National

November 22, 2020

LAHORE: The Punjab government cancelled the import of one vessel carrying 25,000 metric tons of imported sugar following the start of crushing season with surplus carryover stock of 63,994 metric tons while over $52 million foreign exchange had been consumed on the import.

Further, the Punjab government issued a No Objection Certificate (NOC) to Trading Corporation of Pakistan (TCP) requesting it to allow Utility Stores Corporation (USC) to lift the remaining sugar of Punjab quota of 26,700 metric tons arriving from Brazil by the end of November. Earlier, the USC and KP had already lifted 25,000 and 14,000 metric tons respectively from imported sugar quota of Punjab. Additionally, Punjab has also stored 13,500 metric tons of its imported sugar at TCP godowns as the imported sugar was out of demand in the local market.

According to letter no SO(F-III)2-8/2020 on November 19, 2020, of the Punjab food department to Industries and Production Division stated “in continuation of this department’s earlier communication vide letter no SO(F-III)2-8/2020 dated 30.10.20 and with the prior approval of the provincial cabinet”, the food official said, “I am directed to communicate the no objection of the government of the Punjab for allocation of imported sugar tentatively arriving on November 29, 2020 on shipment namely MV Bonnet to the Utility Stores Corporation of Pakistan”. The letter further said “I am further directed to communicate the no objection of the Punjab government in pursuance of the decision of the provincial cabinet in case the Utility Stores Corporation of Pakistan intends to lift the remaining imported sugar from shipment namely Minoan Grace and being stored in Karachi on the request of the Punjab government. I am further directed to point out, that KP government has indicated that some of the above referred remaining imported sugar being stored in Karachi may be allowed to be lifted for KP under the approved mechanism of the Punjab government which will accordingly be communicated once formal intimation to this effect received”.

It depicts the wrong collection and estimates made by Punjab as well as federal government official concerned. The role of former cane commissioner Punjab Wajid Shah, who was later transferred as director food Punjab was vital in the whole sugar price surge scam. He provided all sugar production numbers and anticipated shortage from the start and misguided the federal government alongside provided an opportunity to the industry for price jack-up.

Thus wrong figures allowed the sugar millers to increase the sugar price and compelled the federal government to import sugar to stabilise the sugar rates in domestic market.

Similarly, another letter no SO (F-III)2-8/2020 on November 11, 2020 by the Punjab food department to the Industries and Production Division said “the Punjab government requested that remaining imported sugar from the vessel Minoan Grace be lifted and stored in the TCP godowns at Pipri in Karachi by the TCP for which the incident costs will be paid through the approved mechanism by the Punjab government”.

The letter further said the federal government decided to import sugar for the province Punjab through Trading Corporation of Pakistan in view of anticipated shortage of the sugar in the months of October and November 2020.

The letter said “the cargo of the first vessel has been lifted by the Punjab government through the Punjab Sugar Dealers Association (PSDA) through a mechanism as approved by the provincial cabinet”.

However, the PSDA later showed inability to lift all the imported sugar stocks as the market was flooded with both local and imported sugar but the prices were not coming down.