New Delhi: The government has decided not to penalise sugar exporters whose shipments fall short by 5% of the committed quantity.

“A variation of (-) 5% in weight in exports of sugar against registered contracts shall not be treated as default for the purpose of imposition of penalty or debarment from future registrations,” Director General of Foreign Trade (DGFT) said.

This has been decided with the approval of Competent Authority, it said.

In May end, the commerce ministry has relaxed conditions for sugar exports by raising the quota to 25,000 tonne from 10,000 tonne.

The government had allowed two million tonne of sugar exports in the 2011-12 marketing year, before deciding on May 2 to free sugar exports following high output estimates.

The country’s sugar output is expected to touch 26 million tonne in 2011-12, higher than the annual demand of 21.5-22 million tonne.