After five months” negotiations, Tajikistan has agreed to import some 30,000 tons of white crystal sugar from Pakistan, through Trading Corporation of Pakistan (TCP). Sources in ministry of commerce told Business Recorder on Thursday after getting green signal from Tajikistan, the state-run grain trader would sign a commercial agreement for the export of sugar and sent to Tajikistan officials for their endorsement.
Talks for the export of sugar to Tajikistan are under way for five months, however the talks were delayed due to some dispute on transportation expenses and later on the variety of sugar, as in the initial phase, Tajikistan had agreed to import white refined crystal sugar, but later it demanded powdered sugar, which is costlier than crystal sugar.
In the second week of August last year, in the presence of Minister for Commerce, Makhdoom Amin Fahim and Nurmahmad Akhmedov, Chairman Agency on State Material Reserves of Tajikistan, Pakistan and Tajikistan reached deal on sugar export, under which Pakistan would supply 30,000 metric tons of white refined crystal sugar to Tajikistan at a discount, which will be some $20 lower than international market rates. At the time of negotiations, sugar price in the international market stood at $548 per metric ton and accordingly as per the agreement both parties had agreed on a price of $528 per ton, which was some $20 per ton less than international market rate.
When the modalities of exports were being finalised, suddenly, Tajikistan demanded for “white powdered sugar” instead of “white crystal sugar”. Mainly, the TCP have stocks of white crystal sugar and powdered sugar was not available with TCP. Therefore, with an aim to complete export deal with Tajikistan, TCP floated a tender to procure powdered sugar from domestic mills for Tajikistan. In response to TCP tender some six responsive bids were received from local sugar mills and their offers ranged from Rs 63,400 to Rs 80,650 per metric ton.
A minimum price of powdered sugar in terms of dollar, estimated, some $653 per ton, which is much higher than the already settled price of $528 per ton. Accordingly, Pakistan discussed the situation with Tajik officials and made it clear that in case of import of powdered sugar, Tajikistan has to pay a higher price instead of already agreed price.
Sources said that Tajikistan is not willing to pay higher price and finally has again agreed to import/procure white refined crystal sugar, which is cheaper than powdered sugar. “After mutual understanding, on behalf of supplying agency, Chairman TCP Tahir Raza Naqvi signed a commercial agreement and accordingly sent to the commercial consular of Tajikistan for approval and signature of their concerned official,” they added. On January 15, TCP sent a commercial agreement and is expected to send back during next week, they added.
All arrangements have been made for export of sugar to Tajikistan as white crystal sugar is already available with state-run grain trader. After receiving commercial agreement from Tajikistan, it is expected that sugar export will starts in the first or second week of February 2013, they added.