The provincial governments and Passco have procured 0.8 million tonnes less wheat than the target of 4.730 million tonnes set by the federal government for 2005, official sources told Business Recorder here on Wednesday.
When the issue of wheat procurement came under discussion in the previous meeting of the Economic Co-ordination Committee (ECC) of the Cabinet, it was informed that wheat procurement was almost completed, and the provinces and Passco have procured 3.939 million tonnes against the projected target of 4.730 million tonnes, the sources added.
Stocks of wheat with the provincial governments as on July 31 were 2,491,508 million tonnes in Punjab, 538,940 million tonnes in Sindh, 57951 million tonnes in NWFP and 20,657 million tonnes in Balochistan. Passco had 1,032,830 million tonnes of wheat in its stocks.
The production target for Punjab was 3,000,000 million tonnes, Sindh 500,000 million tonnes, Balochistan, 30,000 million tonnes and Passco, 1,200,000 million tonnes, but apparently none of them achieved the target.
The sources said that the private sector aggressively participated in the market which according to a report of the State Bank of Pakistan (SBP) borrowed over Rs 11 billion to purchase close to 2 million tonnes of wheat as compared to 1.31 million tonnes purchased last year against the total borrowing of Rs 10.260 billion. Additional quantity has also been purchased by the private sector from their own resources.
Resultantly, the strategic reserves of 0.9 million tonnes could not have been built because the Punjab government at an early stage expressed the desire to build up strategic reserves through wheat import, the sources said.
But now the provinces have refused to release wheat to the flourmills despite the direction from the federal cabinet, saying that they did not have adequate stocks for compliance of the decision. They said that their comfort level can be raised only through a timely decision to import adequate quantities of wheat to build their strategic reserves.
Keeping in view the procurement made by the provinces and Passco, Ministry of Food, Agriculture and Livestock (Minfal) had suggested that it should be allowed to arrange local purchase or import 0.8 million tonnes of wheat of the specification to be prescribed by Minfal at appropriate time trough the Trading Corporation of Pakistan (TCP).
The federal government may pick up price differential between the imported price and issue price.
The sources also said when the federal government finalised wheat procurement for 2005, it was decided that there would be no restriction on inter-district or inter-provincial movement of wheat products. It was also decided that there should be one wheat market in the country and no province/area would pursue a segmented approach.