In a major policy shift linked to reforms agreed upon with the International Monetary Fund (IMF), the government has decided to fully exit the sugar sector, handing control over to market forces.
After wheat, the government is now set to deregulate the sugar sector. A comprehensive plan prepared by a government committee has been obtained by Samaa TV, outlining wide-ranging reforms aimed at ending state intervention.
The move is part of structural reforms required under Pakistan’s IMF programme.
Farmers to gain complete freedom
Under the proposed plan, farmers will have complete freedom to cultivate sugarcane. There will be no restrictions on sugarcane varieties or cultivation zones.
Farmers will also be free to sell sugarcane to any sugar mill of their choice or use it to make jaggery, with no government interference.
Govt to end price controls on sugarcane
According to the document, the government will no longer determine sugarcane prices. The existing minimum support price mechanism will be abolished.
Instead, market demand and supply will determine sugarcane prices, marking a major shift in agricultural pricing policy.
The proposed plan states that the government will not provide any subsidy on sugar exports in the future. It also recommends removing export quotas currently imposed on sugar mills.
In addition, the longstanding ban on sugar import and export will be lifted, allowing free trade in the commodity.
New sugar mills to be allowed
The government has proposed lifting the ban on setting up new sugar mills across the country. Sugar mills that have remained closed for up to eight months will now be allowed to import raw materials.
Mills will have full freedom to process locally grown sugarcane or imported raw sugar.
Under the deregulation plan, sugar mills will be permitted to import raw sugar from abroad, refine it locally, and re-export it. This is expected to improve capacity utilization and boost exports.
The market will also determine sugar prices, with government control over sugar pricing coming to an end.
Safeguards to protect farmers
To protect farmers from potential losses, the committee has proposed issuing a list of prohibited sugarcane varieties before the sowing season. This measure aims to prevent the cultivation of low-yield or unsuitable varieties.
Officials believe this step will balance market freedom with farmer protection.
The proposed reforms signal a decisive shift toward a market-driven agricultural economy. By exiting the sugar sector, the government aims to reduce fiscal burdens, encourage competition, and align with international reform commitments.
If approved and implemented, the changes will fundamentally reshape Pakistan’s sugar industry.
