NEW DELHI/MUMBAI, Aug 22 (Reuters): India, the world's biggest sugar consumer, raised the import duty on the sweetener to 25 per cent from 15 per cent as part of efforts to help regional mills struggling with lower prices and higher stocks.
A rise in the duty will make imports unviable for port-based refiners despite a plunge in global prices due to ample supplies from top exporters Brazil and Thailand.
In June, Food Minister Ram Vilas Paswan had said the import duty could be raised to 40 per cent from 15 per cent if mills pay farmers' dues, estimated at nearly 50 billion rupees.
Mills say a 70-per cent jump in the price that they have to pay to farmers in the biggest cane-growing state of Uttar Pradesh and a meagre 7 per cent rise in sugar prices have worsened their finances, leading to cane dues.
"There was an import parity but mills were not signing deals, expecting revision in the import duty. At 25 per cent duty, imports are not viable," said a Mumbai-based dealer with a global trading firm.
In the current sugar year to September, India is likely to import just 30,000 tonnes compared with 680,000 tonnes a year earlier, an industry official told Reuters earlier this month.
The benchmark sugar futures in India rose 1 per cent after the increase in the duty, while shares of sugar makers such as Bajaj Hindusthan Ltd, Shree Renuka Sugars Ltd and Balrampur Chini Mills Ltd rose more than 4 per cent.
India raises sugar import duty
FE Team | Published: August 23, 2014 00:00:00 | Updated: November 30, 2026 06:01:00
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