Govt to waive procurement rules for sugar import

Decision based on ‘unusual consumption pattern’

ISLAMABAD:

The government on Thursday decided to apply for exemption from competitive bidding process the import of 300,000 metric tonnes of sugar.

In its summary to the Economic Coordination Committee (ECC) of the Cabinet, the Ministry of Industries and Production showed sugar stocks depleting from 3.365 million metric tonnes on May 11 to just 1.685 million tonnes on July 22.

“From mid-June till mid-July 2020 the consumption/offtake was 1.041 million tonnes/month, as against normal consumption pattern of 442,000 metric tonnes per month,” according to the official summary that became the base for the ECC’s decision on Tuesday to import 300,000 metric tonnes of sugar.

In the same meeting, the ECC had set up a committee under the chairmanship of the finance secretary to review and recommend the mechanism for early import of sugar due to the anticipated shortfall.

However, if one goes by the latest consumption pattern mentioned in the official summary, there would not be any sugar left in the country by September - three months before the advent of the new crushing season.

Sources told The Express Tribune on Thursday that the ECC-constituted committee decided that a case would be moved to the board of Public Procurement Regulatory Authority (PPRA) for exemption from PPRA rules for swift import of sugar.

The PPRA rules are aimed at ensuring transparency and saving the national exchequer from losses in public procurements.

It was revealed during Thursday’s meeting that neither the Ministry of Industries nor the Ministry of Commerce had done their work before the meeting.

An official of the Trading Corporation of Pakistan initially showed reluctance in procuring sugar, saying that its role is only limited to implementation.

No plan was shared with the committee about transportation and the required subsidies that will be needed to import the commodity and sell it in the domestic market.

However, subsequently, it was decided that the TCP and the industries ministry would coordinate to prepare a request for its import.

The international market prices are higher than the local ones, which would require subsidies from the budget. At current rates, the TCP would need at least Rs23 billion or $138 million to just procure 300,000 metric tonnes of sugar. The cost of subsidies will be over and above this requirement.

However, the official summary of the Ministry of Industries suggested that the numbers that had been fed to the ECC for seeking decision about import of 300,000 metric tonness of sugar were not credible to the least.

The government on Thursday decided to apply for exemption from competitive bidding process the import of 300,000 metric tonnes of sugar.

In its summary to the Economic Coordination Committee (ECC) of the Cabinet, the Ministry of Industries and Production showed sugar stocks depleting from 3.365 million metric tonnes on May 11 to just 1.685 million tonnes on July 22.

“From mid-June till mid-July 2020 the consumption/offtake was 1.041 million tonnes/month, as against normal consumption pattern of 442,000 metric tonnes per month,” according to the official summary that became the base for the ECC’s decision on Tuesday to import 300,000 metric tonnes of sugar.

In the same meeting, the ECC had set up a committee under the chairmanship of the finance secretary to review and recommend the mechanism for early import of sugar due to the anticipated shortfall.

However, if one goes by the latest consumption pattern mentioned in the official summary, there would not be any sugar left in the country by September - three months before the advent of the new crushing season.

Sources told The Express Tribune on Thursday that the ECC-constituted committee decided that a case would be moved to the board of Public Procurement Regulatory Authority (PPRA) for exemption from PPRA rules for swift import of sugar.

The PPRA rules are aimed at ensuring transparency and saving the national exchequer from losses in public procurements.

It was revealed during Thursday’s meeting that neither the Ministry of Industries nor the Ministry of Commerce had done their work before the meeting.

An official of the Trading Corporation of Pakistan initially showed reluctance in procuring sugar, saying that its role is only limited to implementation.

No plan was shared with the committee about transportation and the required subsidies that will be needed to import the commodity and sell it in the domestic market.

However, subsequently, it was decided that the TCP and the industries ministry would coordinate to prepare a request for its import.

The international market prices are higher than the local ones, which would require subsidies from the budget. At current rates, the TCP would need at least Rs23 billion or $138 million to just procure 300,000 metric tonnes of sugar. The cost of subsidies will be over and above this requirement.

However, the official summary of the Ministry of Industries suggested that the numbers that had been fed to the ECC for seeking decision about import of 300,000 metric tonness of sugar were not credible to the least.