Bump in supply: Local, international price disparity causing export issue

Food ministry secretary blames provincial autonomy for surplus

ISLAMABAD: Unrealistic wheat price – higher than the international market – is the main reason why Pakistan’s wheat is an unfavourable export, according to National Food Security and Research Secretary Sirat Asghar.

Addressing a press conference on Friday, Asghar said the private sector prefers to import from the international market due to low prices. He added that the government has fixed the wheat rate at Rs1,300 per 40 kilogrammes, as compared to Rs1,100 per 40kg in the international market, the core reason for the export failure.

“Prior to the 18th Constitutional Amendment, it was only the federal cabinet which could fix a uniform price of wheat and other key crops,” he said. “But now, every province fixes its own wheat price.”

He said that after the 18th Amendment, there is much confusion in the agriculture sector pertaining to policy matters that address issues pertaining to provincial autonomy.



“There is an urgent need for clarity for certain policy-related issues between provinces and the centre”, he stated.

The secretary clarified that the food ministry is not responsible for allowing import of wheat from abroad and it is the World Trade Organisation’s regime under which no signatory country could impose a ban on the import of any product.

Asghar said that due to the food ministry’s intervention, the Economic Coordination Committee imposed a 25% regulatory duty on the import of wheat to discourage it and provide an opportunity to consume the domestic surplus stock.

The secretary said that due to the two consecutive bumper crops, the country has surplus wheat stock of around 2 million and they expect another bumper crop which will cross its target.

Talking about the proposal for reducing cost of production of agro-products, the secretary said that they are consulting provincial governments and recommendations will soon be given to the finance division for incorporating them in the upcoming budget.

Published in The Express Tribune, April 18^th, 2015.

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