In a major policy shift, Pakistan has announced plans to fully deregulate the sugar sector by June 2026. The decision comes after consultations with farmers, industry representatives, and international financial advisors.
The move will transfer control of the sugar industry entirely to market forces, ending decades of state intervention. Officials say this reform aligns with IMF-backed structural changes and mirrors earlier deregulation in the wheat sector.
Under the new framework, farmers will have the freedom to grow sugarcane without restrictions on crop variety or cultivation zones. They will also be allowed to sell sugarcane to any mill or divert it for jaggery production.
A central part of the policy is the removal of government control over sugarcane pricing. The minimum support price system will be scrapped, allowing prices to be set according to supply and demand. Experts say this step will create a more competitive and transparent market.
The government will also end subsidies on sugar exports and lift quotas previously imposed on sugar mills. Restrictions on both sugar imports and exports will be removed, allowing mills to trade freely in domestic and international markets.
Sugar mills, including those that have been inactive for months, will now be allowed to import raw materials, process both local and imported sugarcane, and export refined sugar. Authorities expect this flexibility to increase efficiency and boost exports.
To protect farmers amid deregulation, officials will issue a list of prohibited sugarcane varieties before each sowing season. This measure is aimed at preventing cultivation of low-yield or unsuitable crops and reducing potential losses.
Officials say the overall reform package is designed to balance market freedom with farmer protection. The government hopes deregulating the sugar sector will reduce its fiscal burden, promote competition, and enhance the industry’s global competitiveness.
The reforms are expected to reshape Pakistan’s sugar industry, affecting producers, mills, and consumers. Market-driven pricing and trade liberalisation could lead to higher efficiency and better opportunities for export growth.
For related updates on Pakistan’s energy sector, check out our coverage on NEPRA approving electricity price cuts and the new base tariff for 2026. It details how consumers will benefit from the revised rates.
By June 2026, the sugar sector will enter a new era of market orientation. Farmers and mills are urged to prepare for the changes, which promise to increase competitiveness while reducing government interference.
