Fourteen officials of the Federal Board of Revenue (FBR) have been suspended for allegedly enabling the illegal release of unstamped sugar stocks, the National Assembly’s standing committee was told on Tuesday. The inquiry comes amid allegations that sugar millers and dealers manipulated prices to earn an extraordinary Rs300 billion in profits within weeks.
Committee chairman Atif Khan (PTI) directed the Securities and Exchange Commission of Pakistan (SECP) to submit the names of sugar mill directors holding at least 20% shares. Lawmakers said the list should be made public to help determine whether political figures benefited from the scam.
The Ministry of Industries and Production briefed the panel that, after the sugar export deadline passed, millers and dealers drove up prices, earning around $440 million from exports. In 2024–25, sugarcane cultivation rose 1.11%, but extreme weather and crop disease reduced yields and sucrose content, pushing total output down to 5.862 million metric tons (MMT)—a full one MMT less than last year.
Including carryover stocks of 0.5 MMT, total availability was just enough to meet domestic demand, creating conditions for sharp early-2024 price hikes. Although the government agreed with the Pakistan Sugar Mills Association (PSMA) to keep prices capped at Rs159 ex-mill and Rs164 retail until April 19, 2025, millers breached the deal in May and continued raising prices.
FBR’s track-and-trace system, implemented in 2021 to monitor sugar sales, was bypassed with the help of certain officials. Several trucks carrying unstamped sugar have been confiscated. Despite lower production, sugar sales tax revenue jumped to Rs100 billion from Rs65 billion last year.
The prime minister has ordered a special monitoring cell with intelligence agency involvement to ensure enforcement. Officials said sugar imports may be limited to 200,000 tons to prevent price volatility, with current reserves expected to last until November 2025. The committee will also review Public Accounts Committee findings linking the Rs300 billion profits to coordinated market manipulation.
