In a significant policy measure aimed at ensuring adequate domestic availability of sugar and maintaining food security, the Government of India has prohibited the export of sugar with immediate effect till September 30, 2026, or until further orders, whichever is earlier.
The decision has been notified by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce & Industry, through Notification No. 16/2026-27 dated May 13, 2026 issued under the provisions of the Foreign Trade (Development & Regulation) Act, 1992 and the Foreign Trade Policy (FTP), 2023.
As per the notification, the export policy of sugar falling under ITC (HS) Codes 1701 14 90 and 1701 99 90, covering Raw Sugar, White Sugar and Refined Sugar, has been amended from the existing category of “Restricted” to “Prohibited”.
The Government stated that the prohibition has been imposed with immediate effect in order to regulate outbound shipments of sugar and to safeguard domestic supply requirements. The measure is also aimed at balancing food security concerns and stabilizing domestic market conditions during the current period.
Exemptions Under International Quotas
The DGFT has clarified that the prohibition shall not apply to sugar exports to the European Union (EU) and the United States of America (USA) under the existing CXL and Tariff Rate Quota (TRQ) arrangements. Such exports will continue to be governed through the prescribed procedures notified separately under relevant Public Notices.
Advance Authorization Scheme to Continue
The notification further states that sugar exports under the Advance Authorization Scheme (AAS) will continue as per the existing provisions contained in the Foreign Trade Policy, 2023 and the Handbook of Procedures, 2023. This ensures continuity for exporters operating under duty exemption schemes linked to export obligations.
Relief for Existing Export Consignments
In order to avoid disruption to shipments already in the export pipeline, the Government has allowed certain consignments to proceed even after the prohibition comes into force.
Accordingly, export of sugar shall continue to be permitted in cases where:
- Loading of sugar on the vessel had commenced before publication of the notification in the Official Gazette;
- Shipping Bills had already been filed and the vessel had berthed, arrived or anchored at an Indian port with rotation number allocated by the Port Authority before publication of the notification; and
- Sugar consignments had already been handed over to Customs or custodians before publication of the notification and had been registered in their electronic systems with verifiable date and time records.
The DGFT has specified that approvals for loading of vessels under such transitional arrangements shall be issued only after confirmation from the concerned Port Authorities regarding berthing or anchoring prior to issuance of the notification.
Government-to-Government Exports Permitted
The Government has also provided that export of sugar may be permitted on the basis of specific approvals granted by the Government of India to other countries for meeting their food security requirements, based on requests received from foreign governments.
Transitional Arrangement Under FTP Not Applicable
The notification specifically mentions that provisions related to transitional arrangements under Para 1.05 of the Foreign Trade Policy, 2023 shall not apply in this case. The prohibition has therefore been made effective immediately without the benefit of general transition provisions usually available under FTP regulations.
Policy to Revert to “Restricted” After September 30, 2026
The DGFT has further clarified that if the prohibition is not extended beyond September 30, 2026, the export policy of sugar under the concerned ITC (HS) codes shall automatically revert back from “Prohibited” to “Restricted”.
Effect of the Notification
The notification effectively amends the export policy of sugar from “Restricted” to “Prohibited” with immediate effect till September 30, 2026, or until further orders. However, exemptions remain applicable for:
- Exports to EU and USA under CXL/TRQ quotas;
- Exports under the Advance Authorization Scheme (AAS);
- Government-to-Government exports approved for food security purposes; and
- Consignments already in the physical export pipeline before issuance of the notification.
The Notification can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/05/sugar-notification.pdf
