Government Vows to Stabilize Sugar Prices and Tighten Market Oversight

Deputy Prime Minister Ishaq Dar reaffirmed the government’s determination to regulate sugar prices and maintain a steady supply to ensure market stability, as reported by state-run Radio Pakistan on Friday.

Despite official directives and multiple interventions aimed at capping sugar prices at Rs130 per kilogram, market rates have surged beyond Rs180 per kg in various regions across the country.

Earlier, the deputy prime minister had cautioned that sugar prices should not surpass Rs164 per kg. However, even after his warning, consumers continued to pay inflated rates, with the national average fluctuating between Rs164 and Rs180 per kg in different cities.

While presiding over a high-level meeting in Islamabad, Dar addressed the ongoing sugar crisis and assessed compliance with previously agreed-upon measures. According to Radio Pakistan, he conveyed his “satisfaction” regarding the recent reduction in sugar prices.

He further instructed the Pakistan Sugar Mills Association (PSMA) to strictly adhere to the agreement, ensuring that sugar remains available at or below Rs164 per kg across the country.

Sugar demand is projected to increase slightly to 6.7 million tonnes due to rising population figures and the expanding food processing sector. Meanwhile, last season’s production exceeded 6.84 million tonnes, and forecasts suggest an upward trend in 2024-25.

With concerns mounting over alleged profiteering, the Competition Commission of Pakistan (CCP) has intensified its scrutiny of the sugar industry. The commission has warned that any signs of anti-competitive behavior will be met with stringent enforcement and policy measures.

The CCP has been actively working to dismantle cartel-like operations in the sugar sector, fostering fair competition and safeguarding consumer rights.

An investigation launched by the CCP in 2020 found that sugar mills were likely engaged in price manipulation and supply control through coordinated strategies facilitated by the PSMA. In response, the CCP conducted raids and, in August 2021, levied a record Rs44 billion fine on sugar mills and the PSMA—one of the highest penalties in the commission’s history.

FAQs

1. Why are sugar prices still high despite government regulations?
   • Market manipulation, hoarding, and non-compliance by certain stakeholders have contributed to sustained high prices.
2. What measures is the government taking to control sugar prices?
   • Authorities are closely monitoring supply chains, enforcing price regulations, and working with the PSMA to stabilize retail rates.
3. How is the Competition Commission of Pakistan addressing price-fixing?
   • The CCP is investigating anti-competitive practices, imposing penalties on violators, and conducting raids to deter price manipulation.
4. Will sugar production be sufficient to meet demand in 2024-25?
   • Yes, projections indicate that sugar production will increase, helping to meet the country’s growing consumption needs.
5. What penalties have been imposed on sugar mills for price manipulation?
   • The CCP has levied a historic Rs44 billion fine on sugar mills and the PSMA for alleged collusion and supply control tactics.