NAJAM SETHI PROGRAM ON SUGAR CRISIS

DATED: 15TH Nov, 2010.

In today Program we discuss the matter of sugar crisis.

In sugar crisis there are some General & special reasons. First we highlight the
special reasons.

Special Reasons:

 For the last 2 years Eid & Ramzan has come in the season of October &
November. In this season crushing is in process & the demand of sugar
increase. During these 20 to 30 days if shortage occurs then prices
increase 100% to 200% like a sky rocket. When the Eid has gone
automatically the prices has stable.

 Another main reason is the manipulation of farmer as well as Mill owner.

Not only farmer holds the crop but also the mill owner delays the
crushing due to which sugar crisis generate. Bothe the parties’ wants
abnormal profit.

In this scenario federal Government blame on provisional Government

that they don’t avail their quotas & Provisional Government blame on
Federal Government all these type of blames are worthless.

General Reasons:

In Pakistan we have 84 Sugar Mills in which most of the sugar mills are
belongs to politicians and they are also our policy makers. During
Musharaf Government they banned on opening of new sugar mills but
increase in capacity was allowed. They also allowed 0 rated import of
sugar. After democracy our politicians again impose 25% tax on import
because the want 25% profit from local sugar.

Now question arise who create sugar crisis?

The person who are sitting in our parliament they are getting license &
installed sugar mills same practice adopt in past. 60% to 70% sugar
mills are totally related with politician in the shape of ownership, joint
ventures & shareholding.
Mostly of the sugar mills have been installed in the period of PML & some have
been installed in the period of Benazir.

 PML –N has 11 sugar mills such as Etafaq Sugar Mill, Kashmir

Sugar Mill, Brother Sugar Mill, Chaudary Sugar Mill & etc.
 PML-F (peer pagar a sb.) has also 2 sugar mills the owner is
Jahangir tareen expected the next prime Minister.
 Mr. Sarfaraz sb. He has 5 mills belongs to NWFP. After Nawaz
Sharif he has second most sugar mills.
 Nasrullah darakhshat from Rajanpur has 1 sugar mill. He is friend
of Ex. president farooq lagahri.
 Mr. Haroon son of General Akhter Ex DG ISI has 1 sugar mill.
 PML-F has four members in parliament and they have 4 sugar
mills.

They all are holders in sugar crisis. If we want we can easily identify the
responsible person.

FBR put 16% GST on sugar industry on the price of 28 Rs. /KG this 16%
GST has also refund to industry. If someone want to identify the
responsible then he can easily identify but no one identify because they
all are in same capacity.

Pakistan is the 5th largest country having largest area for sugar cane and
15th largest producer of sugar. We produce 3.7(M) Ton & our demand is
4.3(M) ton. Aprox 0.6(M) Ton shortage creates which was balance by
TCP. Now question arises that we have 5 th largest area for sugar cane but
we are 15th largest producer of sugar mean less per Acre yield due to in
efficient use of natural resources.

In my point of view if same land is used for other cash crop such as
wheat & rice instead of sugar then we get better benefit but we support
sugar industry & Government has provide 3 to 4 (BN) subsidy to sugar
industry in past.

Now a day there is a shortage of sugar in International Market but if we

import the sugar then we get sugar at 60 RS. /kg.
Measures to overcome sugar crisis:

There is a need to take several measures to overcome sugar crisis in

future.

1. Government make a transparent policy regarding sugar industry

but they are not able to make a transparent policy same as they
are not able to put tax on upper class.
2. Banned on new mills as well as to increase the capacity.
3. Operate free market & allow import of sugar on 0% duty.
4. There is also need to make a policy to put proper tax.