| Date: |
15-05-2015 |
| Subject: |
Food, commerce depts at loggerheads |
The food ministry has taken a strong exception to the commerce department’s “unilateral decision” to reject the former’s recommendation and strip a sugar industry body of its exclusive right to export the sweetener to the EU and the US under a preferential quota system.
In a sign of an escalation of the tussle between the departments of food and commerce, food minister Ram Vilas Paswan has written to commerce minister Nirmala Sitharaman, seeking a review of the latest decision.
Paswan is peeved that the commerce department has made a u-turn even on its own decision made in January after consultations with the food ministry. Paswan has got the support of former food and agriculture minister Sharad Pawar, who has endorsed the food ministry’s recommendations in a separate letter to Sitharaman.
FE was the first to report on May 4 the tussle between the departments of food and commerce on the export issue.
The food ministry had suggested to the commerce ministry that the Indian Sugar Exim Corporation (ISEC) — formed by two leading sugar industry associations representing both private mills and co-operatives and the designated agency for such exports since 1991 — be the designated agency for the exports of 10,000 tonne of organic sugar to the EU and 8,200 tonne of raw sugar to the US under the preferential quota system again in the marketing year through September. Exporters get to ship out sugar to the EU and the US at concessional tariff under the system.
“It is understood that the department of commerce had issued an office memorandum dated January 1, 2015, nominating ISEC for exports of sugar under the EU EXL quota and the US TRQ quota for the current season 2014-15. The nomination had been made on the basis of the request of the department of food and public distribution after getting my approval in this regard,” Paswan said in the letter.
“However, through a subsequent order, the department of commerce has reviewed the decision, and the nomination of ISEC for executing preferential quota has been withdrawn,” he said.
So technically, even a Louis Dreyfus or a Cargill can export sugar from India under the preferential quota system, instead of only the ISEC members who account for 90% of the country’s sugar producers.
Paswan said the food ministry has consistently stated that the benefits arising out of the quota-based exports should be utilised for the larger benefit of the industry.
“It may not be optimal nor desirable that export benefits are cornered by a single private entity. The funds generated by ISEC are exclusively utilised for the benefits of the sugar industry and due to its representative nature, it was considered appropriate to continue the sugar exports under the preferential quotas to the EU and the US through ISEC,”he said.
According to the latest notification by the Directorate General Of Foreign Trade, any entity or trader can now export sugar to the EU and the US under the quota system. It has also said while the additional DGFT would oversee sugar exports to the EU, along with Apeda, the Apeda would monitor the outbound shipments to the US.
Source : financialexpress.com
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