IMF Sets Tough Condition: Government Prepares Comprehensive Plan to Deregulate Sugar Sector

Islamabad: The federal government has decided in principle to deregulate the sugar sector in order to meet another key condition set by the International Monetary Fund (IMF), and has prepared a comprehensive plan for the purpose.

According to sources, under the proposed plan farmers will be given complete freedom to cultivate sugarcane without restrictions. The government is considering lifting subsidies on sugar exports, removing the ban on establishing new sugar mills, and ending restrictions on the import and export of sugar.

Sources said that after wheat, the government now intends to hand over the sugar sector to market forces. As part of this strategy, a detailed deregulation framework has been finalized to reduce state intervention in the sector.

Under the proposed plan, farmers will no longer be bound by specific cane varieties or zoning restrictions. They will be free to sell sugarcane to any sugar mill or use it for producing gur (jaggery). The price of sugarcane will be determined by the market instead of being fixed by the government.

The plan further proposes that the government will not provide any subsidy on sugar exports in the future and that the existing ban on setting up new sugar mills will be lifted. The export quota system for sugar mills is also proposed to be abolished.

In addition, sugar mills will be allowed to import raw sugar for processing and re-export, and will have full freedom to process sugarcane or imported raw material. The document also reveals that a government committee has recommended lifting restrictions on the import and export of sugar.

To protect farmers from potential losses, it has been proposed that a list of prohibited sugarcane varieties be issued before the sowing season.