Sugar prices have started increasing in Nepal’s domestic market following India’s decision to ban sugar exports, a move that is also expected to push up the prices of sweets, biscuits, confectioneries, soft drinks, and other sugar-based products.
The Indian government published the decision in its official gazette on Wednesday, announcing a ban on the export of raw, white, and refined sugar until September 30, 2026, or until further notice. The move comes amid concerns over a possible decline in sugar production during the upcoming season.
In a notification dated May 13, India’s Directorate General of Foreign Trade (DGFT) stated that the export policy for sugar had been changed from “Restricted” to “Prohibited” with immediate effect.
India is one of the world’s largest sugar producers, and its decision has already impacted global markets. International media reports indicate that sugar prices have risen by 2–3 percent globally following the announcement. However, the ban will not affect previously signed export agreements or shipments to countries in the European Union and the United States.
Indian authorities have cited inflationary pressure and concerns over foreign currency reserves, worsened by rising petroleum prices, as major reasons behind the export restriction. India has been trying to control food inflation and had previously imposed similar restrictions on sugar exports in October 2022, extending them several times afterward.
Following India’s latest move, Nepali sugar producers have reportedly raised sugar prices by Rs 2 per kilogram in the local market. Domestic producers had earlier urged the government to increase customs duty on imported sugar from 15 percent to 30 percent, arguing that they were unable to compete with cheaper Indian sugar.
According to government data, Nepal’s annual sugar production has declined from 155,000 tons to around 120,000 tons due to a sharp fall in sugarcane production. Meanwhile, annual domestic demand stands at around 270,000 tons, with per capita sugar consumption estimated at 4–6 kilograms.
Netra Prasad Subedi, spokesperson for the Ministry of Industry, Commerce and Supplies, said Nepal’s sugar supply would be significantly affected by India’s decision.
“The government will hold talks with Indian authorities requesting them to ease sugar supply for Nepal,” Subedi said.
Retailers have warned that the sugar shortage could become severe during the upcoming Dashain and Tihar festival season, as India’s export ban is scheduled to remain in place until just before the festivals. They also cautioned that black-market activities and price hikes could intensify due to limited supply.
Besides sugar, prices of packed food products such as biscuits, confectioneries, bakery items, soft drinks, tetra-pack beverages, and sweets are also expected to rise in the domestic market.
