ISLAMABAD: Utility Stores Corporation (USC) has moved an application against the sugar mills cartel to the Competition Commission of Pakistan (CCP).
USC has requested CCP to take action against sugar mills for refusing to participate in its tendering process. USC sources stated that the sugar mills cartel was behind the supply shortage being faced by the country. For the past few months, USC repeatedly invited tenders for purchasing sugar and a condition was laid down in the tender process that full payment would be made within 24 hours of the sugar being supplied with the acceptance of tender contracts.
USC had to cancel the tender process, as unusually higher rates were quoted in the tenders. In the wake of price hike in the market, sugar mills affiliated with USC are also refusing to supply sugar. Such abysmal state of affairs has made it impossible for USC to supply sugar to the masses at subsidised rates.
Sources said that the USC chairman, during a meeting, declared PEPRA rules a major impediment for purchasing sugar, adding that USC cannot purchase sugar from market without tendering, owing to PEPRA rules.
Sources also stated that the agreements for purchasing sugar were in place with Chashma Sugar Mills and Premier Sugar Mills but pressure was being mounted on them for suspending the supply to USC.
The Ministry of Industries and Production had given a proposal, in the perspective of government decision, on the export of sugar and provision of freight subsidy amounting to Rs 13 per kilogramme. It stated that the said sugar be supplied to utility stores and benefit of subsidy be given to the public. However, the government rejected this proposal, resulting in losses.
Sources told Daily Times that the market rate of sugar increased by Rs 15 per kilogramme due to its export. Furthermore, consumers have to purchase the sugar at Rs 75 per kilogramme from the market.
The notification issued by FBR regarding control of rates could not prove productive and USC had to plea with CCP.