The Union government has imposed a complete ban on the export of sugar with immediate effect, which will remain in place until September 30, 2026. This decisive step is aimed at bolstering domestic availability and curbing any potential rise in prices. Previously, sugar exports were categorized as 'restricted,' requiring a license for outbound shipments.
Key Details of the Ban
The Directorate General of Foreign Trade (DGFT) issued a notification stating, 'The export policy of sugar (raw sugar, white sugar and refined sugar)... is amended from ‘restricted’ to ‘prohibited’ with immediate effect till Sept 30, 2026, or until further orders, whichever is earlier.' This ban applies broadly but includes specific exceptions.
Exceptions to the Ban
- Exports to the European Union under the CXL concession and to the United States under the Tariff Rate Quota (TRQ) arrangement are allowed. These arrangements permit shipments of specified quantities at reduced or zero customs duties.
- Shipments under the advance authorization scheme, government-to-government exports, and consignments already in the physical export pipeline are also exempted.
Background on Sugar Exports
For the 2025-26 sugar marketing year (October to September), the government initially permitted 1.5 million tonnes for export and later opened an additional 500,000-tonne pool. However, only 87,587 tonnes were approved from the additional pool. The food ministry and sugar mills had anticipated shipments of 750,000 to 800,000 tonnes for the 2025-26 marketing year.
Production Trends
India's sugar production rose by 7.3% to 27.5 million tonnes up to April in the 2025-26 marketing season, driven by higher output in Maharashtra and Karnataka, according to the Indian Sugar Mills Association (ISMA). ISMA projects total production for 2025-26 at 29.3 million tonnes after ethanol diversion, up from 26.1 million tonnes in 2024-25.
Rationale Behind the Ban
Banning exports of a commodity helps prevent price rises amid inflation concerns and uncertainty caused by the West Asia conflict. This measure ensures that domestic sugar supply remains adequate and prices stable for consumers.
