Financial Daily from THE HINDU group of publications
Monday, Dec 13, 2004
Financial Daily from THE HINDU group of publications Monday, Dec 13, 2004 |
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Agri-Biz & Commodities
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Sugar Government - Agricultural Policy Industry & Economy - Exports & Imports `No restoration of export incentives for sugar' Our Bureau
New Delhi , Dec. 12 THE Union Government has ruled out the restoration of export incentives for sugar, including re-imbursement of expenditure by mills on internal transport and neutralisation of ocean freight disadvantage. According to the reply given by the Ministry of Consumer Affairs, Food and Public Distribution to the Parliament Standing Committee of the Ministry, these incentives were provided in the context of a `glut' in domestic production. The country produced a record 200.99 lakh tonnes of sugar during the 2002-03 season (October-September), which left opening stocks of 102.65 lakh tonnes as on October 1, 2003. But with output during 2003-04 plunging to 140 lakh tonnes, the carryover stocks have fallen substantially at the end of the season. The Ministry has estimated production during the ongoing 2004-05 period to decline even further to 125 lakh tonnes, with domestic consumption being around 185 lakh tonnes. "Keeping in view the domestic consumption need, the Government has, therefore, withdrawn the incentive of reimbursement of expenditure on internal transport and freight charges, including ocean freight and handling and marketing charges, in respect of export shipments of sugar made by the factories against the release orders issued on or after June 21, 2004," the Ministry has said in its reply to the Standing Committee report. Earlier, the Government was providing complete reimbursement of the internal transport and freight charges on export shipments being made from June 2002. Further, with effect from February 14, 2003, it was decided to provide mills neutralisation of ocean freight disadvantage at the rate of Rs 350 per tonne on account of export shipments of sugar. The Ministry has said that the Government provides incentives to boost exports, taking into consideration factors such as carryover stocks of sugar, production and consumption trends and international prices. "In view of the high carryover stock and high level of production in the last four years, the Government announced a number of incentives," the Ministry has noted, adding that now "the glut situation is likely to normalise."
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