Overcoming shortage : Punjab and K-P to bear expenses of wheat import
A REUTERS FILE IMAGE
To address the growing wheat shortage in Pakistan, the Punjab and Khyber Pakhtunkhwa (K-P) governments have agreed to bear the entire cost of importing wheat. Lately, the shortage of wheat has created an emergency across all the provinces of the country.
Following a successful government-to-government agreement to purchase 1.5 million tonnes of wheat from Russia, the Federal Ministry of National Food Security & Research has increased its global contacts to purchase more wheat under a similar agreement.
Prime Minister Imran Khan has finally directed federal ministries to import whatever wheat is available at any price for the food security of the people, telling them no to delay the import by justifying higher prices.
Prices of wheat have been rising across the globe after China imported a huge quantity to meet its needs. As a result, six countries, including Pakistan, Iran, and Turkey, had to cancel their tenders for wheat import due to exceptionally high prices during the last two weeks. Considering no further reduction in world prices, all the six countries have decided to accept the prices mentioned in the new tenders.
Punjab, K-P, and Sindh have verbally informed the Federal Ministry of National Food Security & Research of their recommendations to increase the subsidised purchase price for the next wheat crop.
The federal ministry has directed the provinces to send formal proposals in writing.
Punjab and K-P have proposed Rs1,700, while Balochistan has proposed Rs1,800.
The Sindh government has not yet informed the federation of its proposed price. Recommendations to increase the selling price of government wheat sold to flour mills will also be provided by the provinces to the federal government in the next few days.
The ministry of railways and the ministry of shipping have started putting pressure on the ministry of food security and the ministry of commerce to acquire a contract for the import of government-imported wheat from Russia to Karachi port and deliver it from Karachi to other provinces.
For the past two months, Punjab had been demanding the federal government provide imported wheat for Rs 1,400 or share half the subsidy, but the federal finance ministry refused to do so.
If the Punjab government is not able to make immediate payment, the federal government can import wheat but it will be paid from the federal funds given to Punjab. On the other hand, the K-P government informed the federation in writing that it was ready to bear 4.5 million tonnes of wheat at its own expense. Since then, Punjab has also agreed to bear 100% of the expenses.
About 330,000 tonnes of wheat imported by a trading corporation at the official level will reach Karachi in October, while at least two ships of wheat imported from Russia via Pasco will reach Karachi in mid-November.
According to sources, privately imported wheat will also continue to arrive via two or three ships per month and, depending on this situation, the availability of wheat in the domestic market will improve and the open market price will come down.
Published in The Express Tribune, October 5th, 2020.