What's the point of using sugar in savory dishes?

Hot Sour Salty Sweet

Sugar balances both salty and sour flavors in dishes. Adding just a little sugar makes salty things taste less salty and sour things taste less sour, without actually reducing the amount of salt or acid in the recipe.

For example, the liquid base of the Pad Thai recipe I follow contains chili powder, fish sauce, tamarind, and light palm sugar. The palm sugar balances out the sour from the tamarind and the salt from the fish sauce. Without it, the noodles would come out too sour and too salty.

I don't know the physiological reasons for this. Would be interesting to hear them if someone knew ...

Adding sugar to something acidic changes your perception of it up to a point but if you add too much it will start to taste sweet. The trick is to add the right amount so that it doesn't taste sweet but you get the reduction in the other property of the dish. The same applies to bitter flavours which are masked by salt. According to this article by Heston Blumenthal they don't know why it happens but the important thing here is that it does:

Try this great experiment, and you'll see what I mean. Pour some tonic water into two glasses. Add a pinch of salt to one and taste it. Now add a little more salt, and taste again - the tonic will have become sweeter. Carry on adding salt and tasting, and each time the tonic will be sweeter.

You'll eventually reach a point where the tonic starts to taste salty, at which stage taste the two glasses of tonic water side by side. You'll marvel at how the bitterness in the salted tonic has been reduced - there is as yet no hard and fast evidence as to why this happens, though one of the more likely theories is that the salt diverts the mind away from the bitterness inherent in the tonic, and it is the reduction in bitterness that creates the perception of sweetness. '

Sugar doesn't have to add much sweetness to a dish if it's for browning.

Caribbean example: in your pot and mix in a couple tablespoons of brown sugar. Heat it up til the mix starts to caramelize and smoke a bit. Next add your beef cubes, sautéing them in the browning. Along the way, you'll notice that the Browning adds a deep, rich dark-brown color and a wonderfully smoky, molasses-like scent.