Indian sugar mills association

India to host global sugar body meet from April 24

Date:	07 Jan 2012

Source:	The Financial Express

Reporter:	FE Bureau

News ID:	826

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New Delhi: India will host a two-day annual conference of the International Sugar Organisation, starting April 24, which is likely to bring to the fore the issue of lifting decades-old state control over the the sugar sector.

The ISO is an inter-governmental body with 85 countries as members. Food secretary BC Gupta will chair the ISO council. “The conference will focus on India as a key player in world sugar. So there will be some discussion about exports as well as decontrol apart from the production prospects,” said a top industry executive.

Already global consultancy firms, such as Kingsman, have asked India to take advantage of its higher production in 2011-12 and lift government curbs on the domestic market. It should emerge as a regular exporter in a global market currently dominated by Brazil and Thailand, Kingsman has said.

India allowed sugar exports of 1.5 million tonne under the open general licences in the marketing year through September 2010 in three equal tranches after a gap of two years when it faced a shortage.

The government exercises strict control over the sugar sector and decides on the quantum of sugar mills can sell each month. It also mandates the mills them to supply 10% of their output, called levy sugar, at below-cost for state-run welfare programmes. The industry has been saying that such regulations are leading to a regular cycle of boom and bust in sugar output and also stifling the growth of the sector that hasn`t attracted any foreign direct investment for years now.

The demand for government easing control is likely to intensify this year as the country expects surplus output for a second successive year in 2011-12. Sugar output in India, world`s second-largest producer, is likely to rise 300,000 tonnes in the year starting October to 24.70 million tonnes due to higher cane output, according to the food ministry estimates.

The country expects to consume around 21.5 million tonnes in 2011-12, leaving surplus stocks for exports, although the food ministry`s output projection is sharply lower than the industry`s forecast of 26 million tonnes.

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