Government Cancels Sugar Import Tender Due to High Costs and IMF Concerns
The Pakistan government has reportedly cancelled the tender for importing 100,000 metric tons of sugar, according to ARY News, citing official sources.
Earlier, on August 3, the Trading Corporation of Pakistan (TCP) had issued a tender inviting bids for sugar import. However, the deals with all three bidding companies fell through, as none met the required standards set by the government.
Sources confirmed that the submitted bids failed to satisfy government criteria related to price, sugar size, and quality. The quoted prices ranged from $539 to $567 per tonne for fine granulated sugar, while medium-sized sugar was offered at $599 per tonne—rates considered too high and unacceptable by authorities.
In addition to the high procurement cost, the government would have been burdened with additional expenses, including cargo handling charges at Karachi Port, unloading fees, truck loading, and nationwide transportation of the sugar from the port to domestic markets.
Authorities emphasized that the procurement process must be transparent, and no procedural violations would be allowed. They also stressed that neither quality nor price standards would be compromised.
IMF Raises Concerns Over Subsidies
The decision to cancel the tender comes amid pressure from the International Monetary Fund (IMF), which has expressed serious reservations about Pakistan’s plan to offer tax exemptions and subsidies on imported sugar. The IMF warned that such policies could threaten the ongoing $7 billion loan program.
According to sources, the government had planned to subsidize sugar by Rs 55 per kilogram, bringing the price for consumers down despite the landed cost of Rs 249 per kg. However, the IMF opposed the subsidy plan, urging fiscal discipline and market-based pricing.
As of now, the government has put the sugar import plan on hold, prioritizing cost-effectiveness, transparency, and compliance with international obligations.
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