Indian Government imposes stock-holding limits on bulk consumers of Sugar

The Central Government, with a view to augment domestic production of sugar as well as to moderate prices of sugar in the open market, has already taken a slew of steps like permission to import raw sugar at zero duty under Advance Authorization Scheme (AAS) till 30.09.2009 by sugar mills and under Open General License at zero duty by sugar mills / private trade till 31.03.2009 as well as import of white / refined sugar by Central/State Govt agencies / private trade upto 1 million tons till 30.11.2009. In addition, the Central Government has imposed stockholding and turnover limits on dealers of sugar and khandsari to ensure no hoarding of sugar / khandsari takes place.

It came to the notice of the Central Government that some bulk consumers, consuming sugar as a raw material, have started stock-piling sugar in anticipation of further increase in prices of sugar in the market. This has the effect of obstructing adequate availability of sugar to actual consumers. In view of the fact sugar production in the current 2008-09 sugar season has fallen well short of the domestic requirement, such stock-piling by large consumers would have the effect of enhancing the shortage and hence, an adverse effect on open market sugar price.

In order to discourage these consumers from stock-piling sugar and to ensure adequate availability of sugar in the open market for actual consumers, the Central Government has issued an order on 22.08.2009 imposing stockholding limit on consumers, whose average consumption of sugar are in excess of 10 quintals per month, that they shall not keep in stock, at any manner, sugar exceeding fifteen days of such use or consumption, for a period of six months. This order will come into effect 21 days from the date of notification.

However, the stockholding limit on bulk consumers will not apply to any institution belonging to the Central Government or the State Government or an Union Territory administration or a local body or run by a registered charitable trust, hospital, hostel for working men and women and hostel of any educational institution.

Source : Press Information Bureau

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