The raging sugar crisis which has led to unprecedented prices in the retail market has been blamed on a variety of factors. Everything from a shortage of sugar cane to high international prices has come under fire. There has been a hectic trading of blame between sugar cane growers, mill owners, government departments and ministries. Despite the fresh production of 3.6 million tons of sugar and availability of sufficient stocks, the hoarders and market manipulators are trying to create artificial shortage of the commodity in order to boost its prices at the local markets.

The retail price of the commodity in local markets has surged to Rs60 per kg. Ch Abdul Wajid Arain, Chairman Pakistan Sugar Mills Association Sindh, also dispelled the notion of shortage of the sugar in the current year. He pointed out that at least 0.45 million tons reserve of white sweeteners were lying with TCP while federal government have already instructed the TCP for importing another 0.2 million tons. He suggested that government should keep vigil eye on the hoarders to avoid artificial shortage of sugar in the country.

Clearly, the sugar crisis of today has not emerged overnight. It has been engineered and planned well in advance. Sugar cane is a political crop and the sugar business is a political industry. Action against either the powerful lobby of farmers or the even more powerful lobby of mill owners will have serious political consequences.

The result of this game is that consumers are forced to pay almost twice as what they should have to for a basic commodity like sugar. And for no other reason than helping create a windfall profit for mill owners and big agriculturists to use on their next election.

That still leaves one question. What about the government machinery? That’s simple too. The toothless Monopoly Control Authority openly allows the menace of hoarding to liberally take place without so much as conceptualizing that mass-scale raids and tough penalties should be imposed on hoarders and profiteering.

A big part of the problem, of course, is the eagerness of the government to always appear business-friendly. That, too, is all very well in the attempt to gain investment. But until the other side of that face of a tough regulator that ensures consumer interests and is not shy to crack down hard on exploitative industrialists, their aims will lead to misplaced results altogether.

A similar scandal broke under the nose of the Musharraf government when the sugar prices touched the then peak of Rs 35 per kg. A NAB probe ensued against the political big wigs close to the Musharraf government. The NAB probe initially established the charges that politically connected sugar mills owners hoarded large stocks to manipulate the prices. The NAB probe was subsequently shelved on the personal orders of former president Pervez Musharraf.

Kamran Khan revealed some facts about this sweet game in The News;

A game plan to stretch the sugar prices to a record level was made last year when Pakistan Annual Sugar Report 2009-10 forecast sugar production for the current year at 3.65 million tones against Pakistan’s sugar consumption of 4.35 million tonnes, hence a shortage of 7 lakh tonnes of sugar was expected. Advance knowledge of an expected significant sugar shortage provided an opportunity for the governmentís Economic Coordination Committee (ECC) to quickly bridge the gap by ordering import of refined and raw sugar under feasible tariff, a measure that would have kept the sugar prices to a reasonable level.

Sugar trade sources said while extremely short supplies are increasing sugar prices in the face of growing demand because of Ramazan, huge quantities of sugar is being hoarded by sugar companies and some major dealers in the name of advance sales and advance delivery orders.

They are keeping the stock for the beginning of Ramazan when the price will hit the sky and the hoarded stock will then be released for maximum profits, according to an informed trade industry source. Finance Minister Shaukat Tarin says this hoarding by some important players has caused a crisis situation for sugar prices in the country.