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KARACHI: The private sector is seeking the federal government’s nod for the import of some 2 million metric tons of wheat without subsidy to avoid shortage in the domestic market.

The country has missed the wheat production target and the crop output was about 27 million tons for 2022 as against a target of 28.89 million metric tons. Overall, the country is facing a shortage of 3 to 3.5 million metric tons as the domestic wheat production was about 27 million metric tons as against consumption of over 30 million metric tons.

Accordingly, the federal government decided to import wheat from international resources and the Trading Corporation of Pakistan (TCP) was directed to import wheat aimed at to maintain the national wheat strategic reserves to the level of 2 million metric tons. So far TCP has finalized wheat import deals of over one million tons, out of which some 0.7 million metric tons of wheat has already arrived.

Now, Cereal Association of Pakistan (CAP) has requested the government for permission of 2 million metric ton import without subsidy.

In a letter sent to Chaudhary Tariq Bashir Cheema, Federal Minister for National Food Security & Research, Muzzammil R Chappal Chairman CAP has said that commodity traders are deeply concerned at unexpected and untimely decision wherein wheat import by the private sector was not permitted. Unfortunately, this has resulted in unprecedented price hikes in wheat, wheat flour (atta) and other wheat products across Pakistan due to limited availability of wheat, he added.

CAP believed that wheat and flour prices will continue to further increase due to wheat crop losses estimated as high as 30 percent due to recent flooding across the country. Wheat sowing, especially in Sindh, may be delayed as flood water may not recede for another 2-3 months.

Ministry for allowing TCP to award wheat import contract

“The shortage of commodity may worsen inflation outlook unless the private sector is immediately permitted to import wheat on first come first serve basis without any subsidies from the Government of Pakistan and waiving off all prevailing duties and taxes especially Sindh Infrastructure Cess”, he suggested.

According to CAP, its members have the capability to import from international market and distribute wheat quickly across the country. Chairman CAP has assured that commodity importers will not go beyond the approvals notified by the Federal Government.

He has requested the federal government for issuance of import permits without any hindrances or delays to bring down the commodity prices in the domestic market through open competition.

“We are ready to import without subsidy, but it needs timely confirmation and notification for import of wheat to meet the national requirements immediately”, he added. Chappal informed that on the request of CAP the Sindh government is also looking at wheat import opportunities and the Chief Minister has asked the Food Department (Sindh) for taking necessary action in the matter in accordance with relevant laws, rules and policy.

However, he said that the wheat import is the federal government’s domain and the province itself cannot import the wheat.

Copyright Business Recorder, 2022

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