Sugar mills appeal CJP for ban on 'Gurr' production

[Naveed Yaseen]

By Nauman Tasleem

LAHORE: Pakistan Sugar Mills Association (PSMA) after being disappointed from the government of Pakistan for imposing a ban on Gur production and smuggling to Afghanistan has now requested the Chief Justice of Pakistan, Iftikhar Muhammad Chaudhry to come to the rescue of the industry and save the country from yet another sugar crisis.

In a letter written to CJP, Iftikhar Muhammad Chaudhry, the PSMA Chairman, Iskander M Khan has requested the court to take measures to arrest tax free commercial Gur production and its smuggling to Afghanistan. The PSMA for more than a year is continuously requesting the government for banning Gur export and smuggling to Afghanistan.

“It is high time to ban Gur production or else there would be acute shortage of sugar in the coming year,” said Iskander Khan.

“We reminded the government of Gur production and its smuggling to Afghanistan but to no avail,” he said adding now the association decided to ask the CJP to rescue the industry and country or else in the coming year the sugar crisis would be graver than this year, Khan told Daily Times.

“The CJP has taken positive steps in controlling sugar prices and now we are sure he would take interest in the matter,” he opined. He said he has highlighted a number of important points and facts in the letter. He said at present, the Gur is selling over the price of sugar because of large-scale export to Afghanistan. The huge price advantages to the commercial Gur manufacturer over the tax paying sugar industry have jeopardized the sugar production. The commercial Gur manufacturers are free from sales tax and income tax. Due to this, a large quantity of sugarcane is being diverted towards tax-free Gur manufacturing.

Khan said Gur prices range from Rs 60 to 90 per kg due to unbridled export of Gur to Afghanistan. “The commercial operators have already converted about 10 percent of the crop to Gur all over the country further making bleak the prospects of achieving estimated sugar production of 3.4 million tonnes,” he said. The losses estimated due to lesser sucrose extraction by the mechanised commercial Gur crushers viz-a-viz sugar industry have a cost of Rs 2.1 billion to the nation as approximately sugarcane having 100,000 tonnes of sugar valuing over $60 million will be burned under the pans as fuel to manufacture commercial Gur.

He said the Peshawar Valley has four sugar mills having a potential to produce 125,000 metric tonnes of sugar. Two mills have closed down due to non-availability of sugarcane, whereas, the remaining two sugar mills, having a capacity of 80,000 tonnes are at verge of closure rendering 4,000 permanent employees catering for 26,000 family members without employment.

Peshawar Valley produces 3.0 million tonnes of sugarcane in a particular sugarcane season, enough to cater the needs of eight sugar mills. Whereas, the existing two sugar mills requires only 0.8 million tonnes of sugarcane to produce 80,000 tonnes of sugar, PSMA-NWFP has highlighted this important fact to the NWFP government and requested them to mobilise the government machinery to take remedial measures as formulated under the Sugarcane Act 1950. However, up till now, no concrete measures have been taken to enable the mills to produce 80,000 tonnes of sugar to meet the country’s sugar requirement during this acute shortage time, the letter read.

Because of the non-availability of sugarcane to sugar mills the country is facing a production loss of 125,000 tonnes of sugar from the sugar mills located in the Peshawar valley. This also leads to a loss of income tax revenue to the tune of Rs 863 million and Rs 15 million of road cess to the NWFP government.

http://www.dailytimes.com.pk/default.asp...2009_pg5_5