To stop price rise, govt steps in with sugar imports | business | Hindustan Times
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To stop price rise, govt steps in with sugar imports

business Updated: May 02, 2009 01:10 IST
Zia Haq Zia Haq

Ships carrying small mountains of sugar will sail into Indian ports starting May 15, a move that will, hopefully, ensure soaring domestic prices don’t snowball into another election issue.

The Prime Minister’s Office has stepped in to reverse a recent spike in sugar prices. On Friday, the Consumer Affairs Ministry submitted a report to the PMO, which said there was no sugar shortage, blaming rising prices on possible hoarding, said an official familiar with the development, requesting anonymity because of the sensitivity of the matter.

The report comes days after the Hindustan Times said sugar prices had surged as much as 40 per cent in some places in the past month, offering campaign fodder for the BJP.

Some see the spike in sugar prices as a throwback to the 1998 Delhi elections, when costly onions played a key role in the defeat of BJP. Sugar is a freely traded commodity, and the latest control measures reflect the government’s anxiety.

The ships carrying sugar will start sailing in from Brazil and Thailand, an official said on condition of anonymity.

Last week, the government released to the market 6 lakh tonnes of sugar over and above the 54 lakh tonnes it had allocated for April and May. The sugar will be imported by agencies such as the Metals and Minerals Trading Corporation.

Samir Somaiya, president of the Indian Sugar Manufacturers Association, said he expects “supply would remain adequate to meet demand”.