Union Minister Ajit Singh has shot off a letter to Prime Minister Manmohan Singh demanding export sops and hike in import duty to improve finances of sugar millers.

The government hiked import duty on sugar to 15 per cent from 10 per cent to help the industry clear Rs 9,000 crore cane arrears to farmers-- a move that would make the sweetener costlier for the common man.

Sugar stocks rose by over 5 per cent on reports that the government plans to increase import duty to 15 per cent from the current 10 per cent.

Many sugar companies are in the red, with some seeking financial restructuring. The union govt has made an effort to restore the industry to health with partial decontrol of the highly regulated sector in April. However, the disconnect between sugarcane and sugar prices continues to weigh heavily on the sector.

India had an import duty of 60 per cent on sugar till January 2009, which it slashed to zero only when it realised that it may have to import 5-7 million tonnes of sugar.