There are 84 sugar mills operating in the country with a capacity of 4000 tons to 20,000 tons. Most of these sugar mills are operating below their capacity due to the shortage of sugarcane. The farmers and growers are not selling sugarcane at the prices fixed by the government. There are middlemen who are responsible for the high prices of the crop.
Out of 84 sugar mills only 38 are listed in the Stock Exchanges. Those, which are not public limited companies, are owned by private companies and families and thus not accountable to the public.
As the government has miserably failed to control the prices of sugarcane and refined sugar, it is time to find out a permanent solution. I suggest that the Security and Exchange Commission of Pakistan (SECP) should revert to its previous law which bounds and makes it compulsory for the industrial projects with the cost of 200 million rupees to be a public limited company so that the public can have the 50 percent of equity shares in the industries. This will make the sugar mills accountable to shareholders and the monopoly of a family will be dismantled.
The government should not provide any protection to the sugar industries and it should collect the direct income tax from the directors of the companies instead of levying the sale tax. The government should follow the free market mechanism and let the market decide the prices. The government should also allow duty free import of raw brown sugar and refined sugar.
The government can play its role by advocating less consumption of sugar as it is not essential for good health. The banks should not provide direct loans to the sugar mills for purchase of sugarcane. They should make the payment directly to the farmers and growers association. It will eliminate the role of middlemen and investors.
The provinces should establish food authorities to monitor the production of sugar mills and control its hoarding and black marketing. A quota should be fixed for the utilities stores to which sugar mills should be made legally bound to supply a certain percentage of their production to utilities stores. There should be no role for federal ministries and TCP. The provincial government should be responsible for meeting the demand of their population.
S T HUSSAIN
Lahore
