Responding to a projected sugar production of 30.95 million tonnes and a domestic demand of around 28.5 million tonnes, the government has decided to allow the export of 1.5 million tonnes of sugar in the 2025-26 season that began from October 1. In tandem, it has lifted the 50% export duty on molasses, a by-product of sugar manufacture, signaling support to the sugar-cane value chain and mills.

This move follows industry pressure, particularly from Indian Sugar & Bio‑Energy Manufacturers’ Association (ISMA), which had requested permission for up to 2 million tonnes of exports amid a favourable crop outlook. While the export allocation is lower than the industry’s ask, it helps mills offload part of the surplus, support cane payments and reduce stock-pile risks. Analysts caution, however, that global sugar prices remain weak — posing challenges for profitability despite the favourable policy.

In essence, the policy shift reflects how the government is balancing domestic demand, export opportunities and farm-income stability in a sector sensitive to both global commodity swings and local crop cycles.