India’s government may not just maintain current export subsidies but expand them to cover other shipping and marketing costs, according to off-record sources. The main impetus for the move, of course, is the desire to reduce domestic sugar stocks and support sugar pricing, the goal behind the announcement of a 4 MMT buffer stocks—at a cost of Rs 16.7 billion or more than US$240.1 million. (Bloomberg reports the stocks target at 5 MMT.) The Modi government is presumably taking this step because it was satisfied with the effectiveness of an announced reserve stock of 3 MMT a year ago.

Brazil, Australia, and Guatemala had already been pushing back against India’s sugar export subsidies before the WTO. These three sugar exports pushed for a WTO dispute panel in a recent meeting, an effort that was procedurally blocked by India’s representatives, who argued for further negotiations. Per the Hindu Business Line, India could not block the request to set up a WTO dispute panel in the next meeting of the Dispute Settlement Body on Aug. 15.

India wholesale sugar pricing history

Source: Ministry of Consumer Affairs
Posted by: Information Services
Our Information Services team assists our clients with understanding commodity and ingredient market dynamics. Using our extensive database of intelligence, we also produce regular commodity and commercial market publications covering supply and demand fundamentals, news alerts on events that shape the markets, and resource guides to give you a complete picture of the industries we monitor.