Sugar industry asks for lower duty on sugar in Sri Lanka, Bangladesh

The Dollar Business Bureau

As India’s sugar output is estimated to be at record level in the 2018-19 marketing year, expected to result in a surplus, industry body Indian Sugar Mills Association (ISMA) on Thursday requested the Government to seek preferential import duty structure from Sri Lanka and Bangladesh.

“India’s sugar production may exceed in 2018-19 marketing year than 251 lakh tonnes estimated for the current year. So we may have surplus sugar for exports in 2018-19,” said Abinash Verma, Director General, ISMA, while speaking at the industry body’s 83rd annual general meeting. 

Bangladesh and Sri Lanka, the two major sugar importers, levy high import duty at $150 per tonne and $100 per tonne on sugar, respectively. The two Asian neighbours procure around 25-30 lakh tonnes of sugar per year from global market. 

“Therefore, we are requesting the government to seek preferential import duty from Bangladesh and Sri Lanka for Indian sugar,” Verma said. 

Saritha Reddy, President, ISMA said that preferential tariff treatment is needed for Indian sugar as world prices may not be viable for such type of exports, particularly when the prices of sugarcane in domestic market are highest in the world. 

Citing the example of preferential import duty offered by many countries to the neighbours under the regional cooperation such as Indonesia provides to Australia and Thailand, Reddy said, “Such preferential trade tariffs should be offered for sugar imports by Bangladesh and Sri Lanka to India.” 

“Efforts should be started from now itself, so that these markets are available for Indian sugar exporters at concessional import duties from the beginning of the next year, when we would like to export sugar,” she added.

ISMA also urged the Government to impose uniform pricing policy for sugarcane - similar to goods and services tax (GST). Currently, prices for the sweetener and its by-products differ from state to state.

India has SAFTA and bilateral free trade agreement (FTA) with Bangladesh as well as Sri Lanka.