New Delhi, June 17: Sugar industry body ISMA on Friday said that exports of sweetener have become unviable after imposition of 20% customs duty but it will help in maintaining enough stock to meet the domestic demand.

The government on Thursday imposed a 20% export duty on sugar to curboutboundshipments, which had become viable after a sharp rise in global prices over a past few months.

“It seems that the government wants to conserve sugar domestically in view of an expected fall in sugar production in the next 2016-17 sugar season (October-September),” Indian Sugar Mills Association (ISMA) director general Abinash Verma said in a statement. “With the recent spurt in global prices, sugar exports from India was just about becoming viable but the 20% export duty which translates into around $100 per tonne will make Indian exports unviable,” he added.

Verma said the realisation from exports would be lower than sales in the domestic markets following imposition of export duty.

Statingthattherewould be enough availability of sugar in the 2016-17 marketing year on the back of carry-over stocks of 7 million tonne (mt), Verma saidtheexportdutyof 20% on sugar would “ensure a healthier opening balance for 2017-18 season.” Sugar exports from India, the world’s second largest producer after Brazil, is estimated at around 1.6 mt so far in the current 2015-16 marketing year.

India’s sugar output is estimated to decline to 25 mt in the 2015-16 marketing year, as against 28.3 mt in the previous year.