Pakistan Govt Withdraws Sugar Import Tender After IMF Rejects Tax Exemption
Pakistan has reduced its sugar import plan from 300,000 to 50,000 metric tonnes after the IMF objected to tax exemptions, citing violations of a \$7 billion loan deal. Despite the move, ex-mill sugar prices rose to Rs165/kg following earlier export approvals, worsening domestic supply and pushing prices above Rs200/kg.
In a significant policy reversal, the Federal government has withdrawn its earlier tender for sugar imports following the International Monetary Fund’s (IMF) objection to the tax exemption offered on imported sugar.
The Trading Corporation of Pakistan (TCP) had issued a tender on July 11 for the import of 300,000 metric tonnes of sugar as part of the government’s plan to stabilize domestic prices.
However, in response to the IMF’s refusal to accept the tax waiver, the tender has now been cancelled and replaced with a revised one for only 50,000 metric tonnes.
According to official sources, international suppliers have been invited to submit bids for the reduced quantity by July 22.
The government had initially planned to import 500,000 metric tonnes of sugar and had waived all import duties to offset soaring local prices, which have surpassed Rs200 per kilogram for the first time in Pakistan’s history. The retreat from the original plan comes amid the IMF’s warning that such tax concessions violate the conditions of the ongoing $7 billion loan programme.
Despite the permission to import sugar, authorities have raised the ex-mill price instead of reducing it. Sources say the new ex-mill price has been increased by Rs25 per kilogram compared to the rate fixed at the time of export approvals. Compared to the March 2025 government-declared rate, the ex-mill price has gone up by Rs6 per kilogram.
Cabinet documents show that in June 2024, the government had fixed the ex-mill price at Rs140 per kg. In March 2025, it was revised to Rs159 per kg, and under a fresh agreement with sugar mills, the price has now been fixed at Rs165 per kg.
The Ministry of National food Security officially announced the new ex-mill price on Monday.
It may be mentioned here that the government began approving sugar exports in June 2024, allowing a total of 750,000 metric tonnes to be exported between June and October this year, which has further strained local supply and contributed to price hikes.
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Source : Urdu Point
