Urmila Shrestha, general manager of STC, said the ministry gave its nod to raise the price of sugar being sold by government undertakings from Rs 53 per kg to Rs 61 per kg for consumer and Rs 59.50 per kg for dealers.
Due to weak distribution mechanism, consumers are compelled to buy sugar at far higher prices from private sector. Customers are paying as much as Rs 71 for a kg of sugar, which is Rs 18 higher than the government-fixed price. Prior to the price revision, the government undertakings were selling sugar to dealers at Rs 52 per kg.
STC and NTL had jointly proposed the new prices for newly imported sugar from India, citing rising procurement price.
The SCT recently imported 2,500 tons of sugar from the southern neighbor enjoying one percent customs facility. The government has decided to import 50,000 tons of sugar at one percent customs to tame price of sugar which has been climbing up due to the increasing dominance of private players in sugar trading. The government undertakings are importing 45,000 tons from Brazil and 5,000 tons from India.
Through budget for fiscal year 2009/10, the government lowered customs rate in the import of essential commodities, including sugar, to 15 percent from 25 percent. Officials put the domestic demand of sugar at around 150,000 tons. Domestic production of sugar stands at around 110,000 tons.
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