- 10,000 metric tonnes of sugar, purchased before August 14, will be provided to dealers at Rs165 per kilogram ex-mill rate
The Punjab government’s Sugar Coordination Committee and the Punjab Sugar Mills Association (PSMA), during a joint meeting, have reached an agreement on a comprehensive supply framework, resolving disputes over the pricing and distribution of sugar, The News reported.Â
Under the new arrangement, 10,000 metric tonnes of sugar, purchased before August 14, will be provided to dealers at Rs165 per kilogram, based on the ex-mill rate. Despite the mills’ request for a Rs2 per kilogram increase in the ex-mill rate, the provincial government did not approve the hike.
The distribution framework outlined that 40% of sugar produced by mills will be sold to the corporate sector, 30% through registered dealers, and the remaining 30% via deputy commissioners. This new method aims to streamline sugar sales, minimize tax leakages, and ensure more transparency in distribution.Â
Previously, sugar mills had been routing sugar through dealers, but some of it was redirected to the retail market to bypass a five percent sales tax exemption. The revised system mandates mills to channel their sales strictly through designated dealers.
The committee also discussed the inter-provincial supply of sugar. The Punjab government made it clear that sugar consignments would not be sent to other provinces without a formal request from the federal government. However, in light of the recent floods in Khyber Pakhtunkhwa, which have caused significant damage, the provincial government assured that sugar supplies would be allowed to prevent any potential crisis in the affected areas.
Currently, Khyber Pakhtunkhwa operates four sugar mills, while Sindh has 24 sugar mills that also supply to Balochistan. The committee noted that Punjab’s cautious approach was aimed at balancing its own requirements with the needs of other provinces.
The final terms agreed upon in the meeting are expected to be formally signed today [Tuesday] by representatives from the Punjab government and PSMA, giving legal backing to the agreement.
