The Pakistani sugar industry is reportedly optimistic about exporting surplus sugar to India, following the Indian government’s recent decision to permit duty-free imports. This development has emerged at a time of heightened tensions between the two nations. According to an article in The News International, officials from the Pakistan Sugar Mills Association (PSMA) have urged their government to consider this potential export opportunity.

Direct trade between India and Pakistan has been stalled, largely due to political and security concerns leading to the closure of the Attari-Wagah border and aviation routes. However, the decision by India to allow the import of sugar is seen as a chance for Pakistani millers to alleviate their stock issues and improve their financial stability.

The Indian government announced on August 20, 2026, that it would allow the importation of up to 10 lakh metric tonnes of raw sugar under a Tariff Rate Quota (TRQ) until October 31, 2026. The Directorate General of Foreign Trade (DGFT) indicated that this move aims to enhance domestic sugar availability and curb rising prices.

Pakistan’s Sugar Mills Face Surplus Challenges

In light of the surplus sugar stocks, Ch Muhammad Waheed, a senior member of the PSMA and representative of Hunza Sugar Mills Ltd, has called upon the Pakistani government to facilitate exports to India. Waheed highlighted that over 1.2 million tonnes of surplus sugar is currently burdening mills ahead of the upcoming crushing season. Concerns have been raised that another successful harvest could exacerbate the existing stockpile, making it increasingly difficult for mills to procure the next cane season.

Waheed emphasised the proximity of India as a logistical advantage compared to further international markets. He explained that exporting sugar to India could yield foreign exchange, enhance liquidity for mills, lower storage costs, and enable timely payments to sugarcane farmers. Furthermore, he noted that reviving trade relations through sugar exports could foster economic engagement between the two nations.

However, the potential for actual shipments hinges on governmental approval as Pakistan is currently not set up to send sugar to India under existing trade arrangements. Thus, this scenario presents a potential avenue for trade rather than an immediate solution.

Context of India’s Sugar Crisis and Import Strategy

The Indian government’s decision to cut import duties follows a notable increase in domestic sugar prices. On August 18, 2026, the all-India average ex-mill sugar price escalated to approximately Rs 4,000–5,500 per quintal, a rise from Rs 3,900 in the previous year. The government has implemented restrictions on stock holding to avert hoarding and speculative market activities attributed to the price fluctuations.

In July, officials acknowledged that the increasing ex-mill prices were not entirely justified by market demands, indicating that speculative actions contributed to the volatility. The latest policy to permit duty-free imports aims to augment supply and prevent further price surges.

While the Indian shortage of sugar presents a unique potential export opportunity for Pakistan, there are broader issues at play, including adjustments in sugarcane allocation towards ethanol production, an initiative aimed at reducing crude oil dependence. This diversion affects sugar availability, particularly in years of lower stock and harvest expectations, exacerbating price pressures during tight supply conditions.

Despite the flourishing potential for the Pakistani sugar industry, unresolved political relations and legislative structures currently hinder immediate exports to India. The Pakistani government is called upon to evaluate the situation, although actual trade remains constrained by a complex web of regulations and bilateral relations.

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