As sugar prices touched Rs 35 a kg, the government on Friday said the rates may not spiral upward in the festival season if states manage the "little surplus" supply well and crack down on hoarding more effectively.
"There is a little surplus (sugar) with states. So if they can manage distribution well and control hoarding, there won't be a panic-like situation (about prices)," Minister of State for Food and Agriculture K V Thomas said on the sidelines of a function.
The minister's reply reflects the Centre's keenness to see the states acting with renewed focus on issues they are supposed to handle like clamping down on hoarding, imposing stock limit on sugar etc. Last month, Prime Minister Manmohan Singh had directed states to control hoarding and blackmarketing of essential items.
Already, a section of the sugar industry has warned that sugar rates would touch Rs 40 a kg soon -- more than a double in a year-- due to more expensive import. Earlier this week, Food and Agriculture Minister Sharad Pawar said India would import sugar in the 2009-10 season to boost domestic supply.
Sugar prices shot up after production in the 2008-09 season, ending September, was projected to fall to around 15 million tonnes, compared with annual domestic consumption of 22.5-23 million tonnes. Fears of a price spike persist as drought has threatened to dent sugarcane crop this season.