Prices of Essential Food Commodities to Remain Stable in Festival Season: Govt

GG News Bureau

New Delhi, 19^th Oct. The Secretary of the Department of Food and Public Distribution, Sanjeev Chopra, announced on Thursday that the prices of essential food commodities will remain stable during the festival season. The government has implemented a series of measures to ensure price stability.

Sugar Sector

In order to maintain a sufficient supply of sugar for domestic consumers at reasonable prices throughout the year, the Indian government has continued to restrict sugar exports until further notice.

This will also ensure that there are ample stocks of sugar in the country and support India’s efforts towards greener fuel through the Ethanol Blended with Petrol (EBP) Programme.

The Directorate General of Foreign Trade (DGFT), through its notification No. 36/2023 dated 18th October 2023, has extended the restrictions on the export of sugar (raw sugar, white sugar, refined sugar, and organic sugar) under HS Codes 1701 14 90 and 17019990 beyond 31st October 2023 until further notice.

With this policy, the government has once again demonstrated its commitment to prioritizing the interests of the 1.4 billion domestic consumers by ensuring an adequate supply of sugar.

It is worth noting that despite international sugar prices reaching a 12-year high, sugar in India remains one of the cheapest in the world, with only a nominal increase in retail prices that aligns with the increase in the Fair and Remunerative Price (FRP) of sugarcane for farmers. Over the past 10 years, the average inflation in retail sugar prices has been around 2% per year.

In addition, the government is closely monitoring the monthly dispatches of sugar mills to ensure sufficient availability of sugar in the domestic market.

Traders, wholesalers, retailers, big chain retailers, and sugar processors have been instructed to disclose their sugar stock positions on a portal, enabling the government to monitor sugar stocks across the country.

These measures aim to improve the monitoring of the sugar sector and facilitate an adequate supply of sugar in the market.

The Government of India is committed to maintaining a balanced and fair sugar market by preventing hoarding and speculation.

These efforts are aimed at ensuring that sugar remains affordable for all consumers across the country. The government’s proactive measures highlight its dedication to promoting a stable and equitable sugar market environment.

This sugar export policy also supports the production of ethanol from sugar-based feedstocks. In the 2022-23 sugar year, India diverted approximately 43 million metric tonnes (LMT) of sugar towards ethanol production, which is expected to generate revenue of about ₹24,000 crores for sugar-based distilleries.

This revenue has helped the sugar industry in timely clearing the cane dues of farmers and making the sugar sector self-sufficient.

Thanks to appropriate government policies on sugarcane and sugar, sugar mills have made payments of about ₹1.09 lakh crores, clearing more than 95% of the cane dues for the 2022-23 Sugar Season.

 Additionally, 99.9% of the cane dues from earlier seasons have been cleared. Cane dues are currently at an all-time low level, and efforts are being made to clear the remaining dues as soon as possible.

Rice Sector

In order to control domestic prices and ensure domestic food security, the government has implemented several preemptive measures to restrict the export of rice from India. The export of broken rice has been prohibited, and a 20% export duty has been imposed on non-basmati white rice since September 9, 2022. Subsequently, the export of non-basmati white rice was also prohibited on July 20, 2023.

In the fiscal year 2022-23, India exported 17.8 million tonnes of non-basmati rice and 4.6 million tonnes of basmati rice.

Out of the non-basmati rice exports, approximately 7.8-8 million tonnes were parboiled rice. Since August 25, 2023, a 20% export duty has been imposed on parboiled rice.

Initially, the duty was imposed until October 15, 2023, but it has now been extended until March 31, 2024.

The purpose of extending the duty on parboiled rice is to control price increases and maintain adequate availability in the domestic market.

This measure, implemented by the government in August of this year, has resulted in a 65.50% decline in quantity and a 56.29% decline in value in the case of parboiled rice.

Furthermore, customs authorities have been instructed to conduct stricter checks to prevent the export of other varieties of rice disguised as parboiled rice.

Despite the prohibition on non-basmati white rice, India has decided to relax restrictions on the export of specific quantities of non-basmati white rice to certain countries.

The eligible countries for these rice exports include Nepal (95,000 MT), Cameroon (190,000 MT), Malaysia (170,000 MT), Philippines (295,000 MT), Seychelles (800 MT), Côte d’Ivoire (142,000 MT), and the Republic of Guinea (142,000 MT), UAE (75,000 MT), Bhutan (79,000 MT), Singapore (50,000 MT), and Mauritius (14,000 MT).