LAHORE: The Pakistan Sugar Mills Association has rejected FIA’s sugar crisis report saying its members are “shocked and dismayed” at the “surprise” issuance of the document.

“…the report is replete with self-contradictory, speculative, misleading and misconceived statements and averments,” it says in a rejoinder sent to FIA DG Wajid Zia with copies to the prime minister and all the four chief ministers besides other authorities on Wednesday.

Issued on April 4, the report blamed [among others] top leaders of the ruling PTI and sitting ministers as involved in cartelisation to enhance prices in the local market and exported the commodity when there was a shortage in the domestic market and in the process also claimed export subsidies worth billions of rupees from the government.

The PSMA rejoinder said the three-member FIA inquiry committee lacked the requisite experience for investigating trade of commodities which led to “grossly wrong conclusions on calculations of ex-mills price, reasons for increase in price, role and effect of export and subsidies, etc.”

It said the panel did not comprehend the short duration of time (120 days) in which the industry works unlike other sectors and that the sugar prices are controlled by the government by fixing sugarcane support price and then allowing or disallowing export of the commodity.

The millers argued that either the government deregulate the entire sugar business or fix minimum sale price of it like the sugarcane so that no price and related issues ever come up again.

Saying export subsidy was not an unusual thing, it maintained that it was the Economic Coordination Committee that allowed the export on the basis of assessment of stocks by the relevant agencies and that the federal cabinet endorsed the decision.

Referring to relevant part of the report, it said the committee itself identified instances of stiff competition between millers so there was no question of cartelisation/ manipulation as alleged in it. It said the stoppage of crushing by some units was purely on localised cane availability basis and it has nothing to do with the decision at association level.

It pointed out that there was no sugar crisis during the period under consideration by the committee, which failed to get that the price hike in July 2019 was due to increase in sales tax from 8pc to 17pc.

The rejoinder said the data in the report rather points out that at certain occasions the ex-mill price was below the cost of production. It objected to what it said unnecessary mentioning of names of shareholders of some corporate entities and that too selectively without any substantiated material and use of words like “political clout and influence in decision-making”.

Published in Dawn, April 17th, 2020