The federal government and the sugar industry have been at odds since last year's export-import cycle, but does sticking to the current approach serve any purpose? Last year, sugar mill owners vigorously advocated for export permissions, anticipating a strong output. Their request was approved; however, domestic prices subsequently surged, compelling the government to import sugar at elevated costs. Even the Pakistan Sugar Mills Association (PSMA) is not happy with this publication over highlighting the need to ensure smooth local sugar supplies early this year instead of moving towards another half-baked export proposal. For last year's messed-up situation, the industry blamed policy uncertainty, while the government accused mills of exploiting the system. No side emerged as a winner, and the real losers were the growers, consumers, and the national economy.

So far, the federal government is not in favour of exporting sugar from what the industry considers a surplus stock available with them after the current season. Federal Minister for National Food Security and Research Rana Tanvir Hussain told The Centre's policy makes sense given last year's fuss. But continuing to hold onto past grievances may not solve the challenges ahead, especially with national sugar stocks estimated at 1.2 million metric tonnes of surplus over domestic requirements. If it is a verified quantum of stock, reflecting sufficient local availability leading to price stability, the country faces a critical moment. An emerging opportunity for potential sugar exports is developing in India, sparking hope for the resumption of bilateral trade despite strained relations between the neighboring countries.

India is in the process of importing one million tonnes of sugar to address rising domestic prices. This situation presents a mutually beneficial chance for both countries, potentially leading to an easing of their contentious relationship. Millers have already floated the idea to explore this option for exporting 'surplus' stock, offering better prices due to the proximity between the two countries. Importantly, for the upcoming crushing season, sugar industry projections recurrently indicate that a glut is looming, given the next bumper expected output of sugarcane. If not managed professionally, the country could repeat the mistakes of not managing stocks efficiently. Keeping in view the pressing situation, shouldn't the government now engage the sugar industry constructively to create a framework that balances the interests of growers, consumers, mills, and the state if we are going to harvest a bumper crop?

This is particularly important to ensure a smooth transition towards full deregulation of the sugar sector. The good news is that gradual deregulation of sugarcane buying and pricing is already progressing, and farmers are getting better returns than in previous years. However, there is a need to engage farmers further through incentivisation, as, according to them, last year's cane rates remained Rs150 to 200 per maund lower than what the average ex-mill sugar price of the last two years could justify. Increasing grower returns is the need of the hour, and a well-managed export policy can help achieve that without hurting consumers. To prevent future volatility, the government must persuade the PSMA to be a partner in maintaining an annual minimum strategic reserve of 1.0 million metric tonnes, which may be split equally between refined and raw sugar.