Sindh cabinet approves Rs9.3/kg additional subsidy on sugar export

KARACHI: Sindh cabinet, in order to resolve matter between the growers and millers to start crushing sugarcane in the province, has decided to grant an additional subsidy of Rs9.3 per kg for export of surplus sugar.

The cabinet meeting held under the chairmanship of Sindh Chief Minister Syed Murad Ali Shah here at the New Sindh Secretariat on Monday also asked sugar millers to clear dues of the growers.

The meeting was attended by provincial ministers, advisors, special assistants, chief secretary and other relevant secretaries.

The agriculture department apprised the cabinet that Pakistan Sugar Mills Association (Pasma) has requested for grant of subsidy to export sugar.

Read More: ECC allows export of 1.5m metric ton sugar

Minister Home and Agriculture Sohail Siyal told the cabinet that there was 500,000 tons of surplus sugar available with the millers.

Pasma said that the production cost of sugar had risen to Rs64.19 per kgm, therefore, purchase of sugarcane at Rs182 per kg was not feasible for them until and unless they were allowed export of surplus sugar and given subsidy on export at Rs20 per kg because the sugar price in the international market was very low.

The Economic Co-ordination Committee (ECC) of the cabinet has allowed export of 1.5 tons of sugar and a cash freight support of Rs10.7/kg even then the millers are not ready to start the crushing. Therefore, in order to resolve the matter the cabinet may approve the remaining amount of subsidy of Rs9.3 per kg on export of sugar, requested the agriculture department.

The ministers and secretaries discussed the matter threadbare and finally the cabinet approved the subsidy on export of sugar. The chief minister said that there must be a condition for the sugar mill owners to clear the liabilities of the growers to qualify for getting the subsidy.

Sindh cabinet fixes wheat procurement target at 1.4 tons

The other item the cabinet discussed in detail was fixing of wheat procurement target. The meeting was told that there was a bumper crop of wheat this year. Its production is likely to reach to 4.2 tons. It was pointed out that in the government stocks over 1.7 tons of wheat is stored. The cabinet members discussed and decided to fix the procurement target of wheat at 1.4 tons for Rs13 per 40 kg.

Minister for Food & Parliamentary Affairs Nisar Khuhro said that the provincial government was trying to export 300,000 tons of wheat but the federal government was reluctant to announce the rebate.

Sindh Energy Department presented an item in the cabinet for acquisition of additional working interests in the Hub block. The cabinet was told that Sindh Energy Holding Company (SEHCL) established in pursuance of Petroleum Policy 2012 to acquire 2.5 percent working interest in the oil and gas exploration and production blocks partly or wholly located in the province of Sindh.

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The cabinet was informed that SEHCL has initially acquired working interest to full participation basis with PPL and Oil and Gas Development Company Limited (OGDCL) in seven oil and gas exploration and production blocks located in Sindh.

The blocks with working interest share of OGDCL are Ranipur 2.5 percent share, Armala 2.5 percent, Zorgarh 1.7 percent and of PPL Shah Bandar 2.5 percent, Khipro East 2.5 percent, Malir 2.5 percent and Hub 0.15 percent.

The cabinet said that the Sindh government must invest in such projects in the larger interest of the people of the province. Therefore, it approved acquisition of 2.5 percent working interests in HUB block of PPL.

Informatiin minister:

Sindh Information Minister Syed Nasir Shah briefing the media about the cabinet meeting decisions said that the provincial government has received Rs60 billion short from the federal transfers. “This attitude causes problems in the financial health of the province,” he said.

Brushing aside the impression of giving subsidy on export of sugar just to accommodate a particular person, Nasir Shah said that the decision was taken to start crushing. Through the new arrangement of giving additional subsidy and fixing sugarcane price, a deadlock between the growers and millers have been brought to an end. Now, neither the cane would dry up nor the crushing would delay. “This decision has been taken in the interest of the growers and the millers,” he said.