India’s food and consumer affairs ministry wants to introduce a 25 percent export duty on sugar to keep domestic supplies comfortable in its effort to curb rising prices.
“There is an increasing trend in the price of sugar in the international market. Traders may increase the export of sugar to make profit. Therefore, to keep the export of sugar in control, it is purposed to levy 25% custom duty on export of sugar,” Food and Consumer Affairs Minister Ram Vilas Paswan tweeted.
“It will keep sufficient availability of sugar in domestic market and the price will be under control,” he said in another tweet.
Two straight years of drought has created agriculture stress in the country and the government has been forced to take stesp to calm domestic prices of food and food grains.
It recently suspended an earlier decision for compulsory exports of 3.2 million tonnes of sugar and also capped the amount of sugar traders can hold to discourage hoarding that leads to price rise.
Sugar prices in India have risen by about 40 percent on fears that production could drop 14 percent since October last year. Global prices are up around 12 percent since last month.
The Indian Sugar Mills Association has said the country is likely to produce 25 million tonnes of sugar in the 2015-16 marketing year, down 11.7 percent from a year ago.