Economy

Part of sugar shipments from India missing, says Maldives

Maldives has said a part of sugar shipments to be imported from India through special provisions under a bilateral agreement is “missing”. Male has begun “scrutinising” the shipments from India, an official of Maldives State Trading Organization (STO) told the local media.

The official was responding to fears over the availability of sugar in Maldives following a November 20 businessline report that the Directorate-General of Foreign Trade (DGFT) has begun a probe into sugar exports from India to Maldives being diverted to Sri Lanka.

Following the launch of the DGFT investigation into the diversion, exports of sugar to Maldives have almost come to a standstill, trade sources said. 

Situation manageable

The official said the missing part of the sugar shipments were part of the allocation made under the 64,494.33 tonnes by India to the Maldives to meet its domestic requirements. These shipments are allowed through Mundra, Tuticorin and Nhava Sheva sea ports besides the Inland Container Depot, Tughlakabad. 

Though India has not allowed sugar exports in the 2023-24 and 2024-25 seasons, it permitted shipments on a government-to-government basis for “vulnerable” countries earlier this year. On April 5, 2024, the DGFT issued a notification under the bilateral agreement with Maldives permitting rice, wheat flour, dal, sugar, eggs, potatoes and onions, besides stone aggregate and river sand. 

The STO official said the supply of sugar to the Maldives “will not be disrupted” and the situation is “manageable”. The official said the imports into Maldives could be done before March 31, 2025.

Lanka’s separate probe

Trade sources told businessline that at least seven parcels of sugar set to be exported to Maldives have been detained at the Nhava Sheva port on the suspicion that it was being diverted to some other origin. Sri Lankan Customs officials have detained about 70 containers of Indian sugar diverted to Colombo after an alert following the businessline report that part of export consignments were being diverted.

Sri Lanka officials have stopped clearances of such diverted cargoes at Colombo. They have begun a separate probe against the buyers based in Lanka. Over 80 container loads of sugar from the country, permitted for exports to Maldives, landed in Colombo, Sri Lanka, until mid-October.

A copy of the bill of lading dated September 30, 2024, made available to businessline, showed that shipments of 270 tonnes were made from the Nhave Sheva port with the final port of destination as Colombo. 

The bill claimed that the cargo was in transit to Male, Maldives, at the consignee’s risk. The bill had a curious note asking the buyers to return the empty containers to the “carriers nominated depot in Colombo on consignee account”. The Male port is not a minor port that requires containers to be returned to Colombo.  The sugar consignments were reportedly made available to Lankan traders, sources said.

The invoice raised for the shipment revealed a cost and freight payment of $580/tonne totalling $1,56,600 to be paid by a Colombo-based firm to a UAE-based shipper. The consignee was “to be advised”.  Another invoice dated September 23, 2024, showed a Dubai-based firm selling another 270 tonnes at $585/tonne totalling  $1,57,950 to an unmentioned consignee. It, however, wanted a  Colombo-based company to be notified. 

Invocies switched?

Traders alleged that invoices have been switched to show the destination as Colombo and the buyer as a Sri Lanka trader. Sources said the practice for such shipments is to generate documents for exports and customs clearance for the country to which shipment is permitted. 

Once the cargo is out of customs’ charge, they get the bill of lading switched to the destination to which it is to be diverted and substitute the invoice.  Some consignments have even gone to Port Klang in Malaysia from Nhava Sheva port.



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