After sustained pressure from agriculture minister Sharad Pawar for allowing sugar exports after a bumper crop this season, an empowered group of ministers (EGoM) on Thursday gave nod for 5 lakh tonne of sweetener exports. With this approval, the government has allowed one million tonne of sugar exports since April.

EGoM on food headed by finance minister Pranab Mukherjee also allocated an extra 5 million tonne of food grain to families above the poverty line (APL), Vilasrao Deshmukh, rural development, minister said on Thursday after a meeting with ministers.

In April, the government had allowed 5 lakh tonne of sugar exports under Open General Licences (OGL), which ensures shipment without any restrictions. However, the industry had been demanding permission to export an additional 1.5 million tonne in view of higher output this year.

Pawar did not attend the EGoM, as he is currently attending G-20 meeting in Paris. Last week, Pawar had urged the Prime Minister Manmohan Singh to allow the further export of sugar, for better realisation of the value sweetener in the global market.

Due to rising global demand, the world sugar prices are ruling high at a premium of R500-600 per quintal in comparison to domestic sugar prices.

Sugar production in the country, which is also the the world’s second largest producer and biggest consumer, is estimated at 24.2 million tonne in the 2010-11 season (October-September) against 18.8 million tonne in the previous season. Annual domestic demand for sugar is estimated around 22-22.5 million tonne.

EgoM also agreed to the food ministry proposal to distribute 5 million tonnes of grain to 11.5 crore APL families through ration shops till March, 2012, in addition to already allocated stocks, to create space for the new crops.

It will be distributed via PDS to families living above poverty line (APL) in 20 states who are not receiving the existing quota of 15 kg at R8.30/ kg (rice) and R6.10/kg (wheat). Additional foodgrain will also be allocated to North Eastern states as well as Himachal Pradesh and Uttarakhand, where APL families have not been receiving the current quota of 35 kg.

The government had earlier announced a similar plan for both APL and BPL families, but off-take by state governments has been poor.

Meanwhile, foodgrain stocks with the government rose to all-time high of 65.60 million tonne as of June 1 due to bumper crop production last year and higher procurement prices.

Sweeter note

In April, the government had allowed 5 lakh tonne of sugar exports under Open General Licences (OGL), which ensure shipment without any restrictions

Last week, Pawar had urged Prime Minister Manmohan Singh to allow the further export of sugar, for better realisation of the value

Due to rising global demand, the world sugar prices are ruling high at a premium of R500-600 per quintal in comparison to domestic sugar prices

Sugar production in the country is estimated at 24.2 million tonne in the 2010-11 season, as against 18.8 million tonne in the previous season