The Food Ministry has issued export orders for nearly 92,000 tonne of sugar to mills till last week out of the total quantity of five lakh tonne that the government has allowed for outbound shipment.
Sugar mills cannot export their produce without a release order from the Food Ministry.
On March 22, an Empowered Group of Ministers (EGoM) on Food headed by Finance Minister Pranab Mukherjee had allowed mills to export 5 lakh tonne of sugar under an Open General Licence (OGL), which do not entail any restrictions.
The decision was notified on April 19. Out of five lakh tonne, 51,500 tonne was reserved for neighbouring countries. The remaining quantity was allocated between the mills on the basis of their average production over the last three years.
According to the latest data, the ministry has issued export release orders for 91,685.91 tonne of sugar to 83 mills. The release orders were not approved for nine mills due to problems in their agreements or applications.
The EGoM had decided to allow mills to export a small quantity of 5 lakh tonne as the country's output is estimated to cross domestic consumption after a gap of two seasons.
Prior to this, the government had allowed mills to fulfill their export obligation of about one million tonne.
The sugar production of India -- the world's second largest producer after Brazil -- is estimated to rise to 24.5 million tonne in the 2010-11 sugar year (October-September) from 19 million tonne in the previous year. The country's annual demand is pegged at 22 million tonne.
In the 2008-09 and 2009-10 sugar years, sugar production was below domestic consumption at 14.53 million tonne and nearly 19 million tonne, respectively. The country had to import about six million tonne of sugar to meet the shortfall.
