Rajesh Rai | Phuentsholing

Starting June 1, India will restrict the export of sugar and the restriction will go until October 31, 2022.

The Directorate General of Foreign Trade, Department of Commerce under the Ministry of Commerce and Industry, India on a notification dated May 24 said: “With effect from 1st June, 2022 upto 31st October, 2022 or until further orders, whichever is earlier, export of sugar is allowed only with specific permission from Directorate of Sugar, Department of Food and Public Distribution (DFPD), Ministry of Consumer Affairs, Food and Public Distribution.”

Sugar in this case includes raw sugar, refined sugar and white sugar.

As per the notification, this move has been taken in order to maintain domestic availability and price stability of sugar. However, the restriction is not applicable to sugar being exported to the EU and USA under CXL and TRQ quota, the notification added.

However, it is not confirmed whether the restriction is applicable to Bhutan.

As Bhutan imports sugar solely from India, if the restriction applies to Bhutan, it could affect the manufacturing establishments, especially the beverages companies that may be affected the most.

Sugar is essential in brewing companies. There are also soft drink companies that import huge quantities of sugar. In 2021, as per the Bhutan Trade Statistics, Bhutan imported sugar and sugar confectionery worth Nu 668.78 million (M) from India and other countries, and Nu 551.50M in 2020.  

A businessman in Phuentsholing said that there is little hope going by the notification.

“It is restricted and not prohibited,” he said, adding that the notification also said export is allowed with specific permission from the Directorate of Sugar, Department of Food and Public Distribution.

“It will however depend on how seriously it will be implemented.”

According to media outlets in India, such a step with the export of sugar is being taken for the first time in six years. India is the second-largest sugar producer and exporter in the world, after Brazil. Indian media outlets say it is initiated in the wake of the Ukraine-Russia conflict that has increased food prices in many parts of the world.

India recently restricted the export of wheat. Similarly, Malaysia has also announced that it will cut the export of chicken from June because of shortages in the country. Malaysia will stop exporting over 3.6 million chickens every month until domestic prices and production have stabilised.