Missing Sugar Shipments Spark Concerns in Maldives

The Maldives has raised alarm over missing sugar shipments allocated under a bilateral agreement with India. Of the 64,494.33 tonnes of sugar designated for Maldives’ domestic needs, a portion has reportedly gone unaccounted for. The Maldives State Trading Organization (STO) has initiated an investigation, confirming the issue to local media outlets.

India’s DGFT Probes Possible Diversion to Sri Lanka

India’s DGFT is probing claims of sugar shipments diverted from the Maldives to Sri Lanka. Following the investigation, sugar exports to the Maldives have nearly stopped.

Trade sources allege exporters rerouted shipments to Sri Lanka by switching invoices.

Sugar Supply in Maldives: Officials Reassure Stability

Despite the ongoing investigation, Maldives officials maintain that the sugar supply will remain stable. An STO representative described the situation as "manageable," ensuring that imports will be completed by March 31, 2025 as planned.

India, which has restricted sugar exports for the 2023-24 and 2024-25 seasons, made an exception for Maldives under a government-to-government agreement. This arrangement facilitates the export of critical goods like sugar, rice, wheat flour, and pulses to vulnerable countries.

Detained Shipments Highlight Growing Scrutiny

Officials at India's Nhava Sheva port seized seven sugar parcels, alleging their diversion from the Maldives. Meanwhile, Sri Lankan Customs intercepted 70 containers of Indian sugar, suspecting rerouting to Colombo after receiving the alert.

A bill of lading dated September 30, 2024, revealed that 270 tonnes of sugar, originally marked for Male, Maldives, were listed as "in transit" but were redirected to Colombo instead.

Allegations of Invoice Switching in Trade Diversion

Sources allege that invoice switching—a practice of altering shipping documents to misrepresent the destination—has played a central role in the sugar diversion. For instance:

• A shipment of 270 tonnes was sold at $0,58 per kg, with a total value of $156,600, paid by a Colombo-based firm to a UAE-based shipper.
• Another shipment of the same size and price, involved a Dubai-based firm. The consignee details were marked as "to be advised," raising further suspicion.

These irregularities suggest deliberate efforts to bypass scrutiny and reroute sugar consignments to alternative markets like Sri Lanka and Malaysia.

Conclusion: Scrutiny Over Bilateral Trade Deepens

The missing sugar shipments have highlighted vulnerabilities in the India-Maldives sugar trade agreement. Allegations of invoice switching and trade diversion underscore the need for tighter controls and greater transparency. While Maldivian officials are confident in maintaining stable supplies, the outcome of the ongoing investigations will determine the long-term impact on bilateral trade relations.





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