Pakistan is preparing to step back from its longstanding control over the sugar sector, a decision driven by IMF loan requirements, according to ARY News. Officials said a full deregulation plan has been finalised, leaving the private sector free to handle sugar production and trade.
Under the proposed plan, the government’s only role will be to maintain a reserve of 500,000 tonnes through the Trading Corporation of Pakistan (TCP), equivalent to about one month of national consumption. All other activities—including pricing, supply, and imports—will be managed by private firms.
Sources say the final draft, developed in partnership with sugar industry stakeholders, will be submitted to the Prime Minister in the coming days. If approved, this will mark a major policy shift in one of Pakistan’s most politically sensitive sectors.
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To shield low-income groups from any sudden price hikes, authorities have proposed increasing subsidies via the Benazir Income Support Programme (BISP).
The plan also calls for exporting surplus sugar to support farmers and stabilise market prices. Officials estimate that increasing mill operations to 70 percent capacity could raise annual production by 2.5 million tonnes. Exporting the extra stock may generate up to $1.5 billion in foreign earnings.
The IMF has previously criticised Pakistan’s use of subsidies and tax exemptions on sugar imports. A government proposal to offer a Rs55 per kg subsidy on imported sugar—priced at Rs249 per kg—was rejected by the lender.