Business
oh-Swastika Shruti
The Center has taken steps to increase the availability of sugar and control rising prices by allowing duty-free import of 10 lakh tonnes of raw sugar under the tariff quota (TRQ) system.
The Center will allow duty-free import of 10 lakh tonnes of raw sugar under TRQ system till October 31, 2026, to increase availability and control price rise, and will also impose stock limits for large consumers from September 1 to November 30.
The authorization will be valid until October 31, 2026, as the government seeks to ensure adequate supplies ahead of the new sugar season and festive period.
At the same time, the government introduced a stock limit for large sugar consumers to prevent excessive stocks and possible supply pressure in the domestic market.
Duty-free import of sugar is allowed until October 31
According to the DGFT, the raw sugar import policy has been revised such that 10 lakh tonnes of duty-free imports can be made under the TRQ scheme.
The idea behind this policy is to facilitate the country’s supply and control rising prices.
Under this policy, sugar mills or refiners with the capacity to process raw sugar into refined sugar are eligible to apply for a TRQ.
The online application period will run from August 21 to August 28, 2026.
The applicant will have to submit a self-declaration of its refining capacity supported by a consent to operate issued by the State Pollution Control Board.
Sugar prices have risen sharply
The government’s decision was made against the backdrop of a significant increase in sugar prices over the past year.
The average ex-mill sugar price across India reached around ₹5,400-5,500 per quintal on Tuesday, up from around ₹3,900 a year earlier, according to industry data.
Retail prices have also increased. Data from the Ministry of Consumer Affairs showed that the average retail price was about ₹52.30 per kg on August 18, compared to ₹46.34 per kg for the same period last year.
Why sugar supplies are a concern
Generally, sugar consumption tends to increase between August and November due to the festive season in India.
The 2026-2027 sugar season is expected to begin from October 1st. According to industry forecasts, initial stocks could be anywhere around 40-42 lakh tonnes and even as low as 32-35 lakh tonnes.
This should be compared with the domestic requirement of around 50 lakh tonnes.
This complicates the sugar availability situation at the start of the new sugar season.
The government expects that imports could help fill the sugar supply gap.
Wholesale sugar consumers face new stock limit
Along with imports, the government has also imposed restrictions on the amount of sugar that large institutional consumers can stock in warehouses.
Food Minister Pralhad Joshi announced that consumers consuming more than 10 tonnes of sugar per month will not be allowed to stock more than their estimated 15-day consumption.
The Sugar (Stock Limit for Wholesale Consumers) Ordinance, 2026 will come into force from September 1 and will remain in force until November 30.
The rule applies to businesses such as confectioners, soft drink manufacturers, food processing companies, sweets manufacturers and other institutional buyers.
A mass consumer is defined as an institutional buyer whose average monthly sugar consumption was at least 10 tons compared to the previous year, excluding the current month.
Earlier stock limits also apply
The latest restriction follows an earlier government regulation that came into force on August 1. This regulation limited the stocks that sugar traders could hold at 4,000 quintals for 30 days and will remain in effect until November 30.
The government introduced the measures amid concerns that lower initial inventories could put further pressure on sugar prices.
Government seeks to speed up imports
The DGFT has also set conditions for allocating the import quota of 10 lakh tonnes.
Preference will be given to importers who commit to completing imports by October 15, 2026.
Importers who do not use the allocated quantity or fail to deliver it within the specified period may be held liable for non-compliance.
Therefore, the government is trying to ensure that imported sugar reaches the domestic market quickly, especially before demand picks up during the festive season.