The Pakistan Sugar Mills Association (PSMA) has rejected claims that Pakistan’s sugar needs should be met through continuous imports, calling such a policy costly and damaging to the local economy.
In a statement, PSMA said sugarcane is a climate-resilient and financially viable crop, unlike other fragile crops affected by floods, global warming, and diseases. The association noted that farmers themselves prefer sugarcane due to its stability and returns.
PSMA said Pakistan is the world’s fifth-largest cane sugar producer and the sugar industry is the country’s second-largest agro-based sector after textiles. The industry provides import substitution worth USD 4 billion, generates around Rs.1,000 billion in economic activity during the crushing season, pays about Rs.225 billion in taxes, employs over 100,000 workers, and supports the livelihoods of more than nine million rural people.
The association highlighted the industry’s use of bagasse to produce electricity for the national grid and pointed to the potential of ethanol to reduce fuel imports. It said the Ethanol Blending Policy (E-10), introduced earlier, should be revived, citing Brazil and India as successful examples.
PSMA criticized government pricing policies, stating that current ex-mill sugar prices are below production costs, making the industry unviable and leading to the closure of 12 sugar mills.
The association said deregulation could raise annual sugar production to 12 million metric tons without new investment, creating a six million metric ton export surplus. This, it said, could earn USD 5 billion from sugar exports and USD 1 billion from ethanol exports annually, with strong demand in Central Asia, Afghanistan, and China.
PSMA urged the government to implement permanent deregulation of the sugar sector, noting that rice and maize sectors are already deregulated and that the IMF has also reportedly supported market-based reforms.
