India has recently allocated 8,606 metric tonnes of sugar to be exported to the US under the Tariff Rate Quota (TRQ) scheme. This allocation is for the US fiscal year of 2025, as per a notification from the Directorate General of Foreign Trade (DGFT). The export of sugar to the US and EU under TRQ is currently ‘Free’, subject to certain conditions. The Certificate of Origin, if required, for preferential export to the USA will be issued by the Additional Director General of Foreign Trade, Mumbai on the recommendation of the Agriculture and Processed Food Products Export Development Authority (APEDA).
The notification from DGFT states the quantity of 8,606 Metric Tonnes Raw Value (MTRV) of raw cane sugar to be exported to the USA under the TRQ scheme from October 1, 2024, to September 30, 2025. A tariff rate quota essentially sets a quota for exports at relatively low duties. Once this limit is exhausted, a higher tariff is applied to additional shipments. In October last year, India extended restrictions on the export of sugar until further notice. Initially, these restrictions were imposed from June 1 to October 31, 2022, and later extended by a year until October 31, 2023.
The export restriction does not, however, apply to sugar being exported to the EU and the US under the concession (CXL) and TRQ quota. The initial idea behind the sugar export restriction was to stabilize domestic sugar prices. The sugar industry plays a significant role in India’s economy, and managing exports is crucial to ensure stability in both domestic and international markets.
By allocating a specific quantity of sugar for export to the US under the TRQ scheme, India aims to effectively manage its sugar trade while continuing to engage in international markets. The TRQ scheme allows for duty-free exports up to a certain limit and provides benefits for exporters while ensuring adequate supplies in the domestic market. With the allocation for the 2025 fiscal year, exporters can plan their shipments and maintain a competitive edge in the US market.
The issuance of Certificates of Origin for preferential exports to the US further streamlines the export process and enhances trade relations between the two countries. By working closely with APEDA and other regulatory bodies, India can ensure compliance with international trade regulations and facilitate smoother export operations. This proactive approach to trade management reflects India’s commitment to promoting exports and enhancing global competitiveness in the sugar industry.
Overall, the allocation of sugar for export to the US under the TRQ scheme underscores India’s strategic approach to managing its sugar trade and maintaining stability in the domestic market. By balancing the needs of domestic consumers with the requirements of international trade partners, India can leverage its position as a key player in the global sugar industry. With careful planning and effective implementation of trade policies, India can continue to expand its presence in international markets while supporting the growth of its domestic sugar industry.
