November 8: The Government of India has extended the ban imposed on export of sugar by one year. The Indian government took such decision to ensure the availability of sugar in the domestic market of India and also to control its price.

This has led to a serious question: How will Nepal meet the demand for sugar?

The Government of India had initially banned the export of sugar from June 1 to October 31 so as to control the rising price of sugar. Issuing a recent notice, India’s Directorate General of Foreign said that the export ban will remain in force until October 31, 2023.

India’s move is certain to increase the price of sugar in the domestic market of Nepal. Authorities expect blackmarketing to flourish amid such ban.

General Secretary of Nepal Retail Trade Association Amul Kaji Tuladhar said that a large amount of sugar consumed in Nepal comes from India. Therefore, the ban imposed by India will directly impact the market price in Nepal, argues Tuladhar.

“The last time when India decided to ban the export of sugar, its price increased from Rs 82 per kg to Rs 95 per kg in Nepal within weeks,” said Tuladhar.

At precent, the price of sugar has already reached Rs 107 per kg.

“The price of sugar is likely to climb further to Rs 110 per kg within a short time,” added Tuladhar.

He argues that blackmarketing of sugar will stop only if the government takes full responsibility of distributing sugar which is essential for every household in the country. Tuladhar said that the Nepali importers did not open LCs for bringing in sugar after they were told that the domestic production of sugar will be enough to meet the demand. However, Tuladhar believes that the domestic production has not been able to make any impact. He says that the price of sugar has increased due to the illegal import of sugar.

Pankaj Joshi, general manager of Salt Trading Corporation, informed that the decision taken by India is certain to affect Nepal because India is the second largest exporter of sugar in the world.

“We do not have any stock of sugar. In such a situation, India’s move will only help smuggling of sugar thrive,” said  Joshi.

Nepal produces 180,000 tons of sugar annually while the demand for sugar in the domestic market is 280,000 tons. As a result, Nepal has been importing   100,000 tons of sugar every year.