The announcement has actually worsened the situation for domestic producers as traders of foreign sugar, in a bid to clear their stocks before quota restrictions are imposed, have reduced prices by Rs 30-40 per quintal in the last few days.

Industry players believe that had restrictions been imposed from the day the announcement was made, such a situation could have been easily avoided. Traders of foreign sugar would then have not reduced prices because it would have meant losses for them.

However, things can take a turn for the better for the domestic industry in the near future. According to sources, the government has sent inspectors to various ports to report on the stock of imported sugar. Information has alreadybeen gathered from Calcutta and Haldia port and around 55,000 tonne of unsold stock has been reportedly traced in the state. Inspectors sent to collect information in other ports are expected to report soon.

Sources say that the government is likely to announce quotas for foreign manufacturers when it gives quota release for domestic producers for the month of July, August and September. This would certainly come as a blessing for domestic producers.

Once quotas are announced for foreign sugar, a lull is expected to take place in sugar imports as activities of traders would receive a setback.

However, the decision to bring imported sugar under provision of periodic release would be of long- term help to the domestic industry only if the policy is implemented in a consistent manner. Otherwise, the industry fears, it would give rise to uncertainty which would ultimately harm their interests.

The argument of the industry is that if the government wanted to provide a level playing field for domestic andforeign units there shouldn't be any conditions imposed on provisions. When quotas are imposed on domestic players why should be it imposed on foreign players only under certain conditions, they say.

Government's aim of giving a fair deal to Indian sugar producers would work only if the provision of periodic release is implemented on a sustained basis for the imported variety, assert domestic sugar manufacturers.