By Staff Reporter
ISLAMABAD: The government on Tuesday allowed another 150,000 tonnes of sugar export, bringing the total to 250,000 tonnes so far this year, as it seeks to generate foreign exchange for its dried coffers.
The decision was taken at a meeting of the Economic Co-ordination Committee (ECC) headed by Finance Minister Ishaq Dar.
“The ECC after detailed discussions on the recommendation of SAB (Sugar Advisory Board), allowed 250,000 tons of sugar for export inclusive of previously permitted 100,000 tons by the ECC on a first come first basis,” the finance ministry said in a statement.
The ECC approved a summary of the food security ministry, the statement said, adding it will apply to sugar exports during the fiscal 2022-2023 year.
“The ECC further decided that dollar proceeds of exports will be recovered with sixty days of LC (letter of credit) opening.”
The export quantity will be distributed among provinces “based on their installed crushing capacity to be determined by Pakistan Sugar Mills Association”.
Last May, Prime Minister Shehbaz Sharif imposed a ban on sugar exports to keep domestic prices at low levels. Dollar shortages forced the government to lift the ban though food inflation skyrocketed to nearly 38 percent in December.
The country has at least 1,000,000 tonnes of surplus sugar stocks at the end of the calendar year 2022. The country produced around 7.9 million metric tonnes of sugar in the last crushing season against annual domestic demand of 6 million tonnes.
Pakistan’s foreign reserves have fallen to as low as $5.82 billion, barely enough to cover a month of imports.
The ECC also approved Rs10 billion for the state-run Pakistan State Oil (PSO).
Petroleum Division tabled a summary on liquidity requirement of PSO for import of LNG and petroleum products in the country,” the statement said.
“It was submitted that PSO has been engaged in the import of LNG in the country to meet the deficit in gas demand and supply and is obliged to clear its financial obligations of the supplier within the stipulated period.”
“In order to enable PSO to remain current in its payment obligations to LNG suppliers as well as to maintain the LNG supply chain, the ECC allowed the release of Rs10 billion budgeted subsidy to Petroleum Division and allowed government guarantees against bank financing upto Rs50 billion,” it added.
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