India has enough sugar stocks to meet festival-season demand, with a record price rally ​driven by speculative buying rather than any real supply ‌shortfall, the head of the country's top sugar industry body said on Monday.

Sugar prices in India, the world's biggest consumer of the sweetener, have jumped more ​than 40% in two months to a record high, prompting ​government to allow duty-free imports of 1 million metric ⁠tons of raw sugar for the first time in nearly ​a decade.

"Sugar stocks and supplies are more than comfortable, and there will ​be no problem at all in meeting higher festival demand," Indian Sugar Mills Association president Niraj Shirgaokar said.

India's sugar demand typically rises from August to November ​during major festivals such as Ganesh Chaturthi, Dussehra and Diwali, when ​consumption of traditional sweets and confectionery increases.

Shirgaokar said any shortage was artificial and caused ‌by ⁠speculative buying, and that government measures, including permission to import 1 million tons of sugar, were aimed at calming market sentiment.

India produced 27.9 million tons of sugar in the marketing year ending Sept. 30, ​slightly below annual ​consumption of 28 ⁠million to 28.5 million tons but above last year's output of 26.1 million tons, he said.

Mills have ​diverted around 3 million tons of sugar for ​ethanol production ⁠and exported about 800,000 tons this year, out of the 2 million tons permitted for export, he said.

India is set to start the new ⁠marketing ​year with opening stocks of around 3.5 ​million tons, down from 5 million tons a year earlier, he added.