The Empowered Group of Ministers (EGoM), headed by Finance Minister Pranab Mukherjee, had on August 12 decided to allow exports of an additional five lakh tonnes of sugar in view of production higher than domestic demand.
"It has been decided to allow further exports of five lakh tonnes of raw, white and refined sugar under OGL," the Food Ministry said in the notification.
In the current 2010-11 season (October-September), the government has allowed total export of 1.5 million tonne of sugar in three equal tranches under the Open General Licence (OGL).
The export quota will be allocated among sugar mills based on their average production of last three years.
Mills can export sugar from their own production or they can source the sweetener from other factories to minimise transportation cost.
The Ministry has given 45 days to sugar mills to apply for export release orders, which will be valid for 60 days.
Sugar production in India, the world's second largest producer and biggest consumer, is estimated at 24.2 million tonne in the 2010-11 season, as against 18.8 million tonne in the previous season. The annual demand is pegged at 21-21.5 million tonne.
As per the initial estimates of industry body ISMA, the production in 2011-12 season is likely to increase to 26 million tonnes on higher acreage of sugarcane.
