Mills demand 60% customs duty on imported sugar

The South India Sugar Mills Association (SISMA) has urged the Central government to impose 60 per cent Customs Duty on imported white and raw sugar, which was prevailing earlier. The Association has also called for imposition of levy obligation on raw and white sugar as applicable to Indian sugar.

The Association in a statement on Thursday said that they were encouraging import of sugar - both white and raw - at nil rate of duty when there was a scarcity of sugar in India.

“But at present, the trading lobby is successfully extending the short-term measures which were put in force for import of sugar much beyond the period necessary as in the next few years the domestics production is going to be much in excess of consumption,” the association held forth.

This move, the association said, has resulted in the flooding of Indian market with imported white and raw sugar resulting in steep fall in sugar prices from the peak levels of Rs 4,000 per quintal in January 2010 to the now existing level of Rs 2,240 per quintal.

The association further noted that domestic sugar manufacturers are subject to levy obligation of 20 per cent whereas imported white sugar and raw sugar do not have this obligation.

“There is a stock holding limit for traders and end consumers of 15 days for the domestically produced sugar whereas imported white sugar does not have any stock holding limit. This has forced bulk consumers of sugar to move away from purchasing domestic sugar resulting in drastic reduction of sugar prices,” a spokesperson for the SISMA detailed.

He added that they are further compounded by monthly release mechanism exists only for domestic sugar and raw sugar refined whereas traders are free to sell imported white sugar without any release mechanism.

“These discriminatory steps are hurting us. Compared with the manufacturing cost and present level of realisation, the industry is incurring a loss of Rs 250 to Rs 300 per quintal,” the spokesperson added.