SUGAR INDUSTRY: PROBLEMS & PROSPECTS

 

Contributing significantly in the rural areas of the country

By AMANULLAH BASHAR
Dec 17 - 30 , 2001

Ashraf W. Tabani, Chairman, Pakistan Sugar Mills Association (PSMA) has expressed the hope that the government would realize and resolve the problems faced by the sugar industry in the larger interest of the economy and enabling it use its full potentials to contribute its due share in socio-economic uplift of the country.

Talking to PAGE, the PSMA Chairman said that sugar industry essentially an agro based industry plays a vital role in creating economic activity in the farms as well as factories. About 78 sugar producing units are engaged in providing jobs to the millions and supporting the poverty alleviation agenda of the government. The construction of farm to factory and factory to the cities is yet another contribution, which the sugar industry is providing silently.

He said that out of an income of Rs60 billion generated by sugar industry almost Rs40-35 billion go to the growers while Rs12 billion on account of sales tax while about Rs7 billion earned by the transport sector. These figures are self explanatory of the contribution being made by the sugar industry in different segments of the economy.

Tabani said that country's sugar production for the current season is estimated at 2.9 million tons while a carried over inventory of 5 lakh tons is already in hand. As far as the availability of the sugar is concerned for next year, we have a safe and sound situation as even after meeting country's total requirement the industry will have a surplus of 4-5 lakh tons. The industry has suggested the government to allow its export to earn some foreign exchange for the country. Replying to a question he said that currently the international sugar price is not attractive however instead of keeping the surplus without any use, it is better to export it.

To another question that how other sugar producing countries are making the sugar export viable, he said that the governments of sugar exporting countries are offering substantial subsidy to support the export of sugar from those countries. He was of the view that sugar industry in Pakistan can also earn foreign exchange by fully utilizing its installed capacity of 5.5 million tons a year which means that the country could have an export surplus of 2-2.5 million tons if this industry is supported to run on its full capacity.

He said that for many years, the sugar cess collected by the government is not being utilized to the purpose however the government has recently assured to make full use of the tax collected for the development of roads from farm to the market.

Tabani was also of the opinion that instead of increasing the area for cultivation of sugar cane, a healthy yield and enhanced recovery of the present size of the crop can increase the size of production. Though improved level of recovery of the current size of crop the size of the total production can be increased considerably, however for better results we will have to go for research to have better the quality and variety of the cane crop.

Meanwhile in order to resolve the problems faced by the sugar industry, farmers and other sectors related to the sugar industry, the government has constituted a broad-based "Sugar Board" to identify and address the problems facing sugar industry. The federal commerce, industry and production minister is the chairman of the Board, while the federal secretaries of industries and production and commerce, the sugarcane commissioner, the representatives of various zones of the Pakistan Sugar Mills Association, the representative of Kisan Board, Farmers Association, sugar-cane growers and technologists are its members.

The joint secretary, ministry of industries and production is the secretary of the Board while provincial governments concerned will also nominate one member each on the Board.

The government has constituted this board with the aim to identify issues pertaining to research and development of sugarcane with regard to crop varieties, quality seed, seed treatment, fertilizers, pesticides, insect pests, diseases, integrated post-management, and provide guidelines for the improvement in productivity of sugarcane.

The Board will study the farmers' investments in sugarcane production and sugar profitable prices wherein farmers, millers and consumers may co-exist.

The board will also address the issues facing farmers in the marketing of their cane including weighment, payment, cane delivery and premium on sugar recovery.

It will also rationalize sugarcane cess across various provinces, take measures to affect recoveries of sugarcane cess from defaulting mills and assure effective utilization of cess funds for research and development of sugarcane and other allied matters including development of rural roads to sugar mills. It will also address the liquidity and working capital problems of sugar industry, improve their working efficiency. The Board will also identify suitable regions and propose mechanism for promotion of sugar beet to substitute sugarcane. The board will also assess domestic requirement of sugar and ascertain supply prospects as well as suggest the government to signal imports or export of sugar in future.