Bulk users get nod to import tax free raw sugar

Bulk users get nod to import tax free raw sugar

New Delhi: The government has allowed bulk users to import raw sugar tax free until 1 April 2011, an official statement said on Thursday.

Bulk users include soft drink, confectionary and biscuit producers who consume over one tonne of the sweetener each month.

They had to earlier pay a duty of 60% to import raw sugar.

A capital-based trade analyst said this move would boost supplies, as imported sugar does not come under stock limit.

The government does not allow bulk users to hold stocks beyond ten days, but this rule does not apply to imported sugar.

“Bulk users account 60-65% of domestic consumption each year," said an industry official.

India’s annual sugar consumption is estimated at about 23 million tonnes.

India, the world’s top sugar consumer, is expected to produce 18.0-18.5 million tonnes of sugar in 2009-10 ending September, a leading industry body said on Wednesday, raising the industry’s forecast by 7-10%, but analysts said the country still needs 2-3 million tonnes of imports.

India’s higher output forecast led raw sugar futures on ICE to tumble 7% on Wednesday, ending its worst quarter in about 25 years.