Share in sugar companies surged on Friday as Food Minister Ram Vilas Paswan said that India will examine raising import tax on sugar to support local prices and help sugar mills clear dues to cane growers.
Share in sugar companies surged on Friday as Food Minister Ram Vilas Paswan said that India will examine raising import tax on sugar to support local prices and help sugar mills clear dues to cane growers.
"We have to keep farmers' interest in mind and have to ensure that sugar mills are in good financial health to clear Rs. 11,000 crore ($1.85 billion at $1 = 59.3450 rupees) arrear to cane growers," he said after a meeting with some of his cabinet colleagues.
Shares in Shree Renuka Sugars and Balrampur Chini surged to their year high levels today. Shree Renuka Sugar gained nearly 14 per cent to Rs 31.80 whereas shares in Balrampur Chini surged 11 per cent to Rs 87.45.
Sugar companies have been struggling to pay their dues to cane growers. The statement from the government has come as a great relief to sugar companies.
Abinash Verma, Director General at ISMA (Indian Sugar Manufacturing Association) said the government must hike import duty on sugar to prevent cheap imports into the country. Sugar prices have fallen in international markets and domestic sugar industry is struggling with over capacity, he added.
India, the world's second-biggest producer after Brazil, imposes a 15 per cent tax on sugar imports.
Local mills have been demanding raising the duty to as much as 40 per cent to help lift prices, which have been pressured by huge stocks.
(With inputs from Reuters)
Sign Up with Google
RECOMMENDED FOR YOU
POPULAR