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ISLAMABAD: Economic Coordination Committee (ECC) of the Cabinet, which is scheduled to meet on Wednesday (today), is likely to allow import of 1.5 MMT of wheat through private importers and 0.2 MMT from Russia through G2G arrangements, sources in Ministry of National Food Security and Research told Business Recorder.

Sharing details, sources said, on the directions of the federal cabinet, Trading Corporation of Pakistan (TCP) floated international tenders and shared their outcome with the Ministry of National Food Security and Research on price and quantity. Provincial governments were contacted for obtaining their endorsement of demand which included 0.50 MMT for Passco, 0.70 MMT for Punjab and 0.30 MMT for KP. However, Punjab requested imported wheat @ Rs 1400/ 40 kg which was not agreed by the Finance Division. The matter was submitted to the ECC of the Cabinet which on August 21, 2020 allowed TCP to import 0.20 MMT on behalf of Passco and directed Khusro Bakhtiar, Minister for Economic Affairs Division and Ministry of National Food Security and Research to contact provincial governments for obtaining fresh endorsement on the basis of price indicated estimated by the TCP. Later on, KP and Sindh each endorsed the quality of 0.150 MMT of imported wheat through TCP. However, Punjab did not respond.

Resultantly, TCP has awarded tenders of imported wheat for the quantity of 0.330 MT at a price of Rs 42,554/ ton or Rs 1702/ 40 kg. During a weekly National Price Monitoring Committee meeting headed by the Prime Minister, Ministry of National Food Security and Research was directed to submit a new summary to the ECC for import of 1.5 MMT of wheat as approved earlier by the ECC.

Concurrently, the import of wheat on G2G basis with the Russian Federation is under way. Passco has been nominated as procurement agency on behalf of Government of Pakistan to negotiate terms and conditions with the Russian side in order to import a minimum quantity of 0.20 MMT of wheat.

Pursuant to the ECC decision of June 10, 2020, DPP issued an import permit for the quantity of 1.5 MMT to private importers. With addition of expected wheat import of 1.574 MMT by the TCP and 0.2 MMT on GTG basis, Ministry of National Food Security and Research notes that in case the aggregate quantity of imported wheat by the private sector, TCP and on G2G basis exceeds 0.2 MMT this may have negative impact on the upcoming wheat cultivation due to anticipated decrease in the local prices and glut of this commodity may also adversely affect the minimum support price mechanism.

Ministry of National Food Security and Research has requested to allow 1.5 MMT import of wheat through TCP immediately, as decided earlier by the Federal Cabinet in its meeting held on August 4, 2020. The incidental charges of TCP over and above the Minimum Support Price (MSP) of wheat will be picked up by the respective provinces, and in case of Passco, the Finance Division.

Copyright Business Recorder, 2020