Pakistan slashes sugar import target to 50,000 tons amid IMF flags subsidy concerns

KARACHI: Amidst fiscal tightening, the Trading Corporation of Pakistan has reduced sugar imports by revising tax incentives.

TCP has reduced its sugar import target, issuing a fresh tender to purchase just 50,000 metric tonnes, a huge cut from its earlier plan to import 300,000 metric tonnes.

The revision is part of a broader review of Pakistan’s sugar import strategy. Initially, the federal government planned to import 500,000 metric tonnes of sugar, of which 300,000 tonnes would be handled by TCP and the remaining 200,000 tonnes through private sector channels.

In the revised tender, TCP invited bids from international suppliers and dealers, with a deadline of July 22, 2025.

The decision comes amid warnings from the International Monetary Fund (IMF), which has expressed concern over proposed tax subsidies for sugar imports. The IMF said such financial concessions could undermine Pakistan’s $7 billion loan program, putting pressure on authorities to adjust their policy to ensure compliance with the fund’s guidelines.

In response, the government is not only reducing import volumes but also examining the possibility of withdrawing tax exemptions granted to private sugar importers.

The move reflects growing fiscal prudence as Pakistan works to meet the conditions attached to the IMF bailout while balancing domestic market demand and inflationary pressures.