Urea being smuggled to Afghanistan

Minister blames Sindh, saying province not sharing data to track movement

ISLAMABAD:

Federal Minister of Industries and Production Makhdoom Khusro Bakhtiar has claimed that urea is being smuggled from Sindh to Afghanistan and the provincial government is not sharing data to track the commodity’s movement.

Speaking at a press conference on Friday, along with Minister of Energy Hammad Azhar and the top management of fertiliser manufacturers, Bakhtiar added that urea movement was being traced on a portal developed by the Ministry of Industries.

“This portal also includes provinces and fertiliser manufacturers; while Punjab is monitoring up to 88% movement of urea, there is no significant response from Sindh,” the minister alleged.

“Urea bags seized in Chaman were coming from a mill in Ghotki, Sindh,” he claimed, adding that the Sindh government should show some sympathy for the country and farmers by stopping the smuggling of fertiliser.

He assured farmers that Pakistan would have surplus 4.4 million urea bags in February and in March the inventory would rise to 8.2 million bags, which would be in the hands of dealers and at fertiliser plants.

“There is no reason to panic, more than 2 million urea bags imported from China have already reached our ports,” the minister revealed. “We are working with provinces to manage sales among districts as per their requirements.”

Speaking on the occasion, Azhar said that smuggling was a lucrative business in the recent past as there was a price difference of around five times between the locally produced urea and the imported one.

However, he added, the Customs had not only confiscated urea consignments being smuggled out of the country, but the entire chain had been traced.

The energy minister pointed out that unlike the tradition, the government did not curtail gas supply to fertiliser plants in November last year and as a result urea production touched its peak in 2021.

Read People involved in 'artificial shortage' of urea will be dealt with iron fist: PM

“At the same time, the government provided subsidised gas to the fertiliser plants, which kept the cost of urea production low while in the international market the commodity was five times costlier,” Azhar said.

Senior management of the fertiliser industry, which included Fauji Fertiliser Company CEO Sarfraz Rehman, Fatima Fertiliser CEO Fawad Ahmed Mukhtar and Engro Fertilisers CFO Imran Ahmed, also spoke.

They said that due to the availability of gas in winter, their plants were running continuously without any interruption. As a result, the urea bag was available at a sharply lower price of Rs1,768 and there was no shortage of the commodity.

Fertiliser manufacturers also highlighted that the current urea price in Pakistan was the same as it was in 2012.

They asked dealers as well as farmers to avoid panic buying and purchase urea only according to their requirements and assured them that there would be no urea shortage in the coming weeks and months.

The manufacturers also said that they had transferred around Rs400 billion profit to the farmers for the benefit of their consumers.

They announced that complaints could be lodged at the helpline of relevant company whose dealer was overcharging or creating artificial shortage of urea. Supplies would be smooth in February too, they emphasised.

Industry players claimed that by adding the impact of subsidised gas, the total benefit being given to the farmers amounted to Rs790 per bag of urea whereas in comparison to prices in the international market the growers were receiving an advantage of around Rs9,000 per bag.

Published in The Express Tribune, January 8^th, 2022.

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