Sources say that India is considering limiting duty-free imports of sugar to reduce record prices.

India is considering a range of'measures', including limiting duty-free imports and tightening stockholding limits for bulk traders. This is in an effort to boost'supplies' and reduce record sugar prices.

New Delhi could rein in domestic prices during peak festival season by importing sugar for the first time since nearly a decade.

A government source, who requested anonymity and cited official rules, said: "We will need to take steps to control prices since there has been an unwarranted rise in prices. We are looking at a variety of tools and measures."

He said that lowering stockholding restrictions, allowing for limited imports, reducing import 'duties, and adjusting sugar allocations by mills to domestic sales are all being discussed.

Since the beginning of August, wholesale sugar prices in Kolhapur have increased by nearly a fifth to a record of 5,350 rupees per 100 kilograms.

A second government source confirmed that the increase is despite there being enough supplies to satisfy domestic demand up until the arrival of next season's products on the market.

"Local?supplies are scarce." Ashok Jain of the Bombay Sugar Merchants Association said that only imports could help to increase supplies and bring down prices during the festival season.

India's sugar consumption typically increases from August to November, during the major festivals of Ganesh Chaturthi and Dussehra, and Diwali.

Earlier this week,? Last week,? Reporting by Rajendra Bhardwaj and Mayank Jadhav; editing by YP Rajesh.

(source: Reuters)