Ban on Export of Sugar [UPSC Current Affairs]

According to recent reports (April 2023), the Centre is planning to prohibit sugar exports due to a fall in production and a desire to avoid any inflationary pressures before the Lok Sabha elections in 2024. In this article, we give you details of this important development from the IAS exam perspective.

Sugar Exports from India – Ban Likely

• Sources claim that a committee of ministers has suggested that mills cease sending sugar overseas with “immediate effect.”
• The production of sugar in India is expected to drop from the previous crop year’s 359 LT to around 327 lakh tonnes (LT) in the 2022–23 crop year (October–September).
• According to sources, even though there is enough to satisfy the expected 275 LT domestic consumption need at this time, the government does not seem to want to take any chances before the upcoming state assembly elections and the 2024 Lok Sabha elections.

Reasons for the ban on sugar exports:

• To preserve the “domestic availability and price stability of sugar”.
• The choice was made in response to “unprecedented growth in sugar exports” and the requirement to keep an adequate supply of sugar in the nation.
• The Centre is now controlling sugar exports for the first time in six years.

Way forward 

• The issue is that inflation has gotten entrenched and is likely to continue over the RBI’s medium-term inflation target of 2-6%, despite the fact that this move will have a moderating effect on pricing pressures in the economy.
• Consistency in import policy is important because it gives the market the right signals early on. Import tariffs are a better way to intervene than quotas, which result in bigger welfare losses.

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