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MUMBAI, Feb. 7

THE Government's decision to totally decontrol the sugar industry during the next fiscal is very much in line with the industry's expectations, sources said.

However, as the ultimate decontrol is linked to futures trading becoming fully operational, the process is a long way off. ``We are not likely to see any development at least in the next 8-9 months as futures trade is scheduled to commence in October 2002,'' said an industry source.

Having reduced the levy obligation from 40 per cent to 15 per cent on sugar mills, the Government is expected to bring it further down to zero levels.

However, the industry is awaiting decontrol at the cane price level. ''Although sugar prices have remained largely constant, sugarcane prices have moved up,'' said the industry source. Cane price, currently, accounts for 65-70 per cent of the cost of sugar.

Trade organisations have welcomed the Government's decision to decontrol sugar. ``The move is calculated to liberate the sugar economy in the interests of farmers, trade and consumers,'' the Bombay Sugar Merchants' Association Ltd (BSMA) said in a statement.

BSMA stressed the need to retain the release mechanism especially at a time when the industry is holding record stocks.

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