Govt to probe sugar imports

Forms committee to look into non-procurement of sugar, scrapping of tenders


Zafar Bhutta August 31, 2021
The committee shall submit its report to the ECC for consideration with viable recommendations to make the process of import of sugar more transparent and efficient. PHOTO: REUTERS

ISLAMABAD:

The Ministry of Industries has submitted proposals to the Economic Coordination Committee (ECC) for consideration.

Firstly, it proposed tender for import of 200,000 metric tons of sugar. Secondly, due to high price for the current tender, it proposed to scrap the tender. The third option was to call for a fresh tender for import of sugar.

The economic decision making body held threadbare discussion on the import of sugar after they were informed that the current sugar reserves stood at 1.18 million MT, which will be exhausted by end-October 2021.

Finance Minister Shaukat Tarin, who also chairs the ECC, observed that the ECC and the federal cabinet took a decision on import of 500,000 MT sugar in January, 2021.

Since then only 100,000 MT sugar was imported. During this period, a number of tenders for importing sugar were scrapped for reasons not recorded. It observed that the import of sugar was now being proposed at a higher cost, which may result in substantial loss to the national exchequer.

The ECC members argued that there was a need to look into reasons for non-procurement of sugar through import immediately after the decision by the ECC and cabinet in January 2021.

It sought reasons for scrapping tenders for import of sugar. It raised questions about the authority that decided to scrap the tenders and financial loss to be accrued as a result of late import of sugar.

The ECC of the cabinet considered the summary submitted by the Ministry of Industries and Production on ‘Import of Sugar for Strategic Reserves’ and approved the first option of tender for import of sugar.

The ECC also constituted a committee under the chairmanship of Finance Division secretary, comprising Industries & Production Division secretary, Commerce Division secretary, National Food Security & Research secretary and Law & Justice Division secretary.

The committee will look into reasons for non-procurement of sugar through import immediately after the decision by the ECC and cabinet in January 2021.

Secondly, it will also probe reasons for scrapping tenders for import of sugar and the authority who decided the said scrapping. Thirdly, it will also look into financial loss to be accrued due to late import of sugar.

Read More: Pakistan receives first two sugar shipments

The committee shall submit its report to the ECC for consideration with viable recommendations to make the process of import of sugar more transparent and efficient.

The Ministry of Industries and Production also briefed the committee about the financial arrangement for import of sugar. It also submitted proposals for import of the remaining 500,000 MT of sugar for strategic reserves, as per the cabinet decision.

It requested to approve an additional amount of Rs27 billion, with the cumulative total of Rs45 billion, to import 500,000 MT of sugar.

It said that the Finance Division may arrange funds to the tune of Rs45 billion through supplementary grant or any other financial arrangement for import and storage of sugar for three months approximately (calculated on the basis of landed cost per metric ton of the last tender floated by TCP)and warehousing cost of Trading Corporation of Pakistan (TCP).

It further requested to direct the TCP to make storage arrangements along with Utility Stores Corporation (USC). The sugar will be released for sale as per market requirements.

The ECC considered the summary submitted by the Ministry of Industries and Production on ‘Financial arrangement for Import of Sugar for Strategic Reserves’ and approved the proposal.

It also directed the Ministry of Industries and Production to ensure immediate import of 200,000 MT sugar and the Finance Division to arrange funds for the same urgently.

Published in The Express Tribune, August 31st, 2021.

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