The government may introduce a tax on bulk purchasers of sugar to cut down on the sale of sugary foods.
Budget documents seen by THE WEEK suggest that the measure has been pending for some years. This year, the issue has been taken up by the sugar department of the food ministry.
If it comes into effect, the decision will impact prices of all food products using sugar in any industrial form. The ministry had maintained in the document that this will not impact consumer prices of the sweetener, while arguing for higher tax on the essential food commodity.
Sugar prices fluctuated between Rs 35 per kg to a peak of Rs 64 per kg in 2016, food ministry data showed.
Concerns over the effect of sugar on health have been raised worldwide.
India is the second largest producer of the sweetner after Brazil, but is expected that there will be a deficit of four million tonnes this year, compared to last years' 24.5 million tonne output.