Two state-owned suppliers have trimmed the import of subsidised sugar from India to 5,650 tonnes based on their market assessment that the revised quantity will be enough for the festivals.

The Nepal government has permitted two supply utilities, the Salt Trading Corporation and the Food Management and Trading Company, to import 30,000 tonnes of sugar, 15,000 tonnes each, through a government-to-government arrangement.

On September 9, a Cabinet meeting permitted the companies to import sugar, waiving 50 percent of the customs duty, citing possible shortages of the sweetener during the festival season.

The companies haven’t given a valid reason to cut imports but said the market has enough sugar.

Some traders said the market is flooded with smug goods, including sugar, causing no panic among buyers.

“We are importing 5,500 tonnes of sugar from India. We are doing our best to bring the sweetener before Fulpati, which is October 10,” said Kumar Rajbhandari, information officer at the Salt Trading Corporation.

The price will be fixed once the sugar arrives, Rajbhandari said, based on the rate set by the Indian supplier.

As India has restricted sugar exports, the state-owned entity asked the government to facilitate imports. “The Indian government provided us sugar under the government-to-government arrangement,” said Rajbhandari.

“I think 5,500 tonnes of sugar will be enough for festive consumption,” said Rajbhandari. The corporation said it will bring good quality sugar.

He said there is no shortage of sugar in the market. The Salt Trading Corporation has provided up to 6 kg to each family. Sugar is now being sold at Rs120 per kg in retail and is expected to rise further as private-sector traders say they are out of sugar stock.

During last year's festival, the government imposed a quota system, allowing each family to buy 2 kg from the Salt Trading depots at a time.

Sharmila Neupane Subedi, the company's information officer, said the Food Management and Trading Company, which has also been allocated an import quota of 15,000 tonnes, is bringing in only 150 tonnes in the first phase.

“The remaining sugar will be imported as needed in other phases. We expect the sugar to arrive within a few days.”

The Food Management and Trading Company sells sugar at Rs102.5 per kg after a discount.

Through the government-to-government arrangement, sugar is being imported from the National Cooperative Exports Limited, India.

It is a multi-state cooperative society serving as an umbrella organisation in India for exports from the cooperative sector.

Subedi said sugar is being loaded in India and will take a day to arrive in Birgunj.

The Food Management and Trading Company has been borrowing sugar and selling from its depots.

Dashain began last Thursday. In Nepal, sugar is consumed in high quantities during the Tihar and Chhath festivals, as tonnes of sweets are sold nationwide.

Nepal consumes 275,000 tonnes of sugar annually. While the domestic output amounts to 150,000 tonnes, the rest is imported.

Last year, Nepal faced a sugar shortage during the festive season, with the price jumping from Rs90 to Rs160 per kg. As sugar was not readily available in the market, consumers were forced to queue for long hours at the Salt Trading and the Food Management and Trading corporations.

According to Reuters, India plans to extend a ban on sugar exports for the second straight year as the world’s biggest sweetener consumer grapples with the prospect of a lower sugarcane output.

According to the news agency, New Delhi plans to prohibit mills from exporting sugar when supplies from Brazil, the world’s top producer, are expected to drop because of a drought in the South American nation.

In October last year, India, the world’s biggest sugar producer after Brazil, banned mills from exporting sugar—the first such curb in seven years.

In November last year, when the country faced a serious sugar crisis, India allowed Nepal to import 25,000 tonnes immediately, a permit that was valid until September.

However, with Indian suppliers quoting high prices, Nepal contacted Pakistan for the sweetener—but to no avail.

According to Nepali traders, the illegal import of sugar has become rampant through the southern border due to India's year-long sugar export ban.

Last Monday, the Armed Police Force seized 600 sacks of smuggled sugar from a truck in Bardaghat Municipality Ward 2. The truck was headed for Kathmandu from Bhairahawa. According to the police, it also carried smuggled mobile phone parts and other goods.