The federal government’s plan to fully deregulate Pakistan’s sugar sector, a key condition of its International Monetary Fund (IMF) agreement, has made little progress, with provincial governments yet to legislate on the matter.
The IMF has reportedly set a March 2026 deadline for the deregulation of the sector, while the federal government aims to completely exit sugar market intervention by June this year. Despite repeated requests from the Ministry of Industries and Production, no concrete steps have been taken at the provincial level.
Once deregulated, the government will cease involvement in sugar pricing, procurement, and supply mechanisms, allowing the private sector to manage all aspects of sugar trade. Surplus production is expected to be exported, potentially offering better returns for sugarcane farmers.
Deregulation will also provide farmers with greater freedom they will no longer be required to cultivate sugarcane or sell exclusively to designated mills. In addition, restrictions on establishing sugar mills will be lifted, and limitations on sugar exports will be removed.
Industry analysts say that while deregulation could enhance efficiency and market-driven pricing, delays in provincial legislation could hinder the government’s compliance with IMF conditions and affect the broader agricultural economy.
