Govt bans wheat import and export

Issues two separate notifications, amending import, export policy orders

ISLAMABAD:

In a significant development, the federal government has imposed a ban on both import and export of wheat and its products with immediate effect. In this regard, the government has issued two notifications, amending the Import Policy Order and the Export Policy Order.

The first notification states that the federal government has immediately imposed a ban on the import of wheat. The second notification indicates that a complete ban has also been imposed on the export of wheat, wheat products, flour, refined flour, and semolina.

In May, a wheat scandal surfaced, involving the import of a significant amount of wheat by the caretaker government, despite the country having surplus wheat stocks.

This decision allegedly caused a loss of more than Rs300 billion to the national exchequer. The import of wheat continued in the first two months of the Shehbaz Sharif government, as 778,000 metric tons worth of wheat, costing $231.32 million was imported.

A summary of one million tonnes of wheat imports for strategic reserves was prepared during the caretaker government. However, in reality 2.778 thousand tons of wheat was ordered. The import took place from September 2023 to March 2024.

Wheat imports led to a glut of wheat in the market, causing prices to fall and farmers to struggle to sell their produce at a reasonable price. Farmers were getting Rs2,800 to Rs3,000 for 40 kg of wheat while a support price of Rs3,900 was promised.

Due to this crisis, farmers resorted to protests in Lahore and many other Pakistani cities.

An inquiry committee was set up to investigate the scandal and determine responsibility. The committee began interviewing officials to identify those responsible for allowing imports of wheat due to the expected shortage. The preliminary report of the investigation revealed that federal agencies are responsible for the unnecessary importation of wheat.

PM Shehbaz later directed the suspension of the Pakistan Agricultural Storage and Services Corporation (PASCO) managing director and general manager procurement due to “negligence and non-compliance with the PM’s instructions regarding the use of technology in the wheat procurement process.”

He also ordered a third-party audit of PASCO stock and additional procurement of 0.4 million metric tons (MMT) of wheat “transparently and efficiently.”