Sunday, 28 November, 2021

India still waiting for Indonesia to relax sugar import norms

The government is waiting for Indonesia to relax norms for importing sugar from India, which is being discussed for more than a year now.

There was a discussion for a two-way deal under which India will give priority to import palm oil from Indonesia against which the latter was offering to buy raw sugar from India, report agencies.

The discussions started when import duty for palm oil from Malaysia was lower than import from Indonesia during Modi government's first term. Since the issue has now been settled, India has been expecting the latter to act on sugar front. That relaxation has been done partly but the major hurdle for exporting raw sugar is still in place for Indian exporters. “We in the sugar industry in India have been waiting since last one year for Indonesia to take action on relaxing norms for sugar import from India. Once that happens, it will open up window of opportunity for Indian sugar industry which is facing glut,” said Abinash Verma, Director General, Indian Sugar Mills Association.

A year ago, import duty for palm oil for Malaysia was lower than Indonesia. This was making import from Indonesia unattractive.

Indonesia approached India to make import duty for both competitors in palm oil at par against which it offered to buy sugar from India.

India accepted the proposal, however, exporting sugar to Indonesia has two hurdles -- the import duty for raw sugar from Australia and some other countries was 5 per cent while for India, it was a specific duty of $30 per tonne, more than the duty for import from countries like Australia. India had asked Indonesia in a government-to-government meeting to make sugar import duty at 5 per cent and relax quality norms for importing raw sugar.