The Competition Commission of Pakistan (CCP) has presented a detailed blueprint aimed at addressing the recurring sugar crises in the country, which have persisted from 2008 to 2025. According to the CCP, these crises stem from export-driven shortages in the domestic market, primarily caused by reliance on inaccurate data and undue influence from sugar mill owners within the decision-making process.
The report, titled “Towards Deregulation: Reforming Sugar Industry of Pakistan for Market Efficiency,” suggests that sugar millers have exploited regulatory weaknesses by securing export permits, which in turn led to domestic price hikes due to resultant shortages. The lack of reliable data and inadequate oversight have allowed for market manipulation, ultimately harming consumers and farmers alike.
Despite the sugar industry being one of Pakistan’s largest agro-based sectors, it has struggled with inefficiencies, price volatility, and recurring supply-demand imbalances.
The CCP points out that previous policy efforts have failed to resolve these issues, as the sector remains vulnerable to hoarding, manipulation, and inconsistent application of minimum support prices.
Additionally, fragmented regulation and overlapping provincial and federal mandates have further hindered progress, allowing powerful vested interests to dominate the industry.
The CCP report advocates for sweeping reforms to modernize the sector and enhance market transparency. It emphasizes the need to integrate real-time data collection and digital infrastructure, such as Internet of Things (IoT) sensors and blockchain technology, to track sugarcane deliveries, quality, and mill yields. This would ensure transparency, prevent irregularities, and expedite payments to farmers.
The report also calls for lifting the long-standing ban on new sugar mills, arguing that the industry would benefit from greater competition, modernization, and the introduction of new technologies.
Furthermore, the creation of a National Sugar Market Surveillance Authority (NSMSA) is proposed to centralize data collection and analysis, streamline regulatory actions, and reduce the undue influence of sugar mill owners on policy decisions.
The blueprint also suggests the implementation of a Conflict-of-Interest Code to prevent individuals with ties to mill owners from holding regulatory positions, ensuring that policy decisions are based on objective, data-driven analysis rather than lobbying.
Additionally, it proposes a shift towards recoverable sugar-based pricing, aligning with international best practices, to ensure fair compensation for high-quality cane and incentivize improved farming practices.
The report also recommends overhauling the current reserve management system, replacing it with a rule-based buffer stock system, managed by the Trading Corporation of Pakistan (TCP), to counteract market volatility and speculative hoarding.
Another significant recommendation is the consolidation of all sugar sector laws into a single, unified federal framework, which would simplify oversight and enforcement while addressing the regulatory fragmentation that currently plagues the industry.
Lastly, the CCP advocates for the liberalization of the sugar market by eliminating government-imposed price controls and lifting export and import bans, provided these actions are based on independently verified consumption data.
The CCP concludes that Pakistan’s sugar industry, valued at Rs 1,000-1,500 billion, is currently benefiting only a small group of 78 mills, with the broader public failing to reap the rewards. Despite being the fifth-largest sugarcane producer globally, the industry remains inefficient, with outdated mills and poor supply chain management. The proposed reforms aim to dismantle cartel behavior, increase competition, and ensure that the sector’s resources are used for the public good.
The CCP stresses that without these reforms, the sugar industry will continue to operate in a manner that favors powerful interests over the welfare of the wider population.
