Amid rising sugar prices in India, the Pakistani industry is viewing the Indian market as a potential buyer for its surplus sugar stocks. The Indian government has taken measures to stabilize the situation by allowing the import of up to 10 million tons of sugar duty-free until October 31 to ease the situation during the holidays.
Despite the political and defense tensions between India and Pakistan, which have led to the closure of direct bilateral trade, as well as air and land routes, Pakistani sugar mills see India's import decision as an opportunity to offload their growing reserves and improve their financial standing.
According to the Pakistani newspaper The News International, Chaudhry Muhammad Waqid, a senior member of the Pakistan Sugar Mills Association, appealed to the government to explore the possibility of exporting surplus sugar to India. The Pakistani sugar industry holds reserves exceeding 12 million tons. The mills are concerned that if this stock is not sold, there may be a shortage of funds to purchase sugarcane from farmers in the next harvest season in November.
Waqid noted that due to India's proximity, Pakistan could benefit from reduced transportation costs compared to distant markets. Exporting sugar to India would allow Pakistan to earn foreign currency, improve the financial position of the mills, reduce storage costs, and help make timely payments to farmers. However, a trade agreement for sending Pakistani sugar to India is currently absent, which requires approval from both governments and the establishment of a trading system.
Sugar prices in India have risen significantly. According to industry data, the average price of sugar by exclusive method on August 18 was around 4000–5500 rupees per quintal, whereas a year ago it was approximately 3900 rupees. The government has imposed storage restrictions to prevent speculation and stockpiling. Furthermore, the availability of sugar has been affected by ethanol production.