New Delhi: The government has removed a duty free import scheme for raw sugar, a move aimed at curbing supplies from overseas.
"Import of raw sugar under Duty Free Import Authorisation (DFIA) scheme is withdrawn with immediate effect," Directorate General of Foreign Trade said in a notification.
The scheme has been withdrawn also to prevent leakages in domestic markets.
Under the scheme, refiners were allowed to import raw sugar, which had to be processed and then exported.
To help cash-starved sugar mills clear dues worth Rs 21,000 crore to farmers, the government has recently hiked import duty on sugar to 40 per cent from 25 per cent and scrapped the excise duty on ethanol made from molasses.
The decision regarding the issue was taken by the Union Cabinet on April 29.
In a separate public notice, DGFT has also shrunk the export obligation window for raw sugar imported under Advance Authorisation to six months, from the earlier 18 months.
"Pre-import conditions shall be mandatory for import of raw sugar under the Advance Authorisation scheme," it said.
An Advance Authorisation is issued to allow duty-free import of inputs, which are physically incorporated in export products.
DGFT has also notified the quantity of sugar to be exported under quota to the European Union (EU) and the US.
Last month, the government had allowed traders or entities to export sugar to the EU and the US under a certain category of quota that entitles shipments to enjoy low tariff.
While 10,000 tonnes were notified for the EU, 8,424 tonnes were marked for the US.
"The quantity of sugar to be exported to the EU under CXL quota and to the US under TRQ up to September 30, 2015, has been notified," it said.
TRQ and CXL are quotas for exports that enter these regions at low tariffs. Once the quota figure is reached, a higher tariff kicks in for additional imports.
