Banking News – India has approved the duty-free import of up to 1 million metric tons of raw material for sugar production under the tariff rate quota system, as the government seeks to control rising sugar prices ahead of the festive season.

The Federal Ministry of Commerce said in a statement that imports of up to 1 million metric tons will be allowed duty-free under the “Tariff Rate Quota” (TRQ) system. The facility will remain available until October 31.

The decision was taken amid growing concerns over the availability of locally produced raw sugar and the potential impact of weaker monsoon conditions on sugar production. Forecasts suggest that the monsoon could be weaker than average this year due to the El Niño weather phenomenon, potentially affecting agricultural production.

El Niño is a natural climate phenomenon that causes above-average sea surface temperatures in the central and eastern equatorial Pacific Ocean, leading to changes in wind and rainfall patterns around the world. The effects can be further intensified by human-induced climate change, as warmer oceans and the atmosphere can provide more energy and moisture for extreme weather events.

The ministry said the decision was aimed at addressing concerns over a possible decline in sugar production, which had contributed to sugar prices reaching record levels, according to reports in Indian local media.

India is one of the world’s major sugar-producing countries, and domestic sugar consumption generally rises between September and January. Demand increases during the festive season as consumption of sweets and other sugar-based products rises.

To increase domestic availability, India had imposed a restriction on sugar exports in May. The export restriction will remain in effect until September 30.