October 31, 2001	Wednesday	Shaba’an 13, 1422

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ISLAMABAD, Oct 30: Punjab and Sindh have differed with the federal government over various broad economic projections including new estimates about wheat and cotton and called for having correct assessment of the situation arising out of the Sept 11 terror attack on America.

Official sources said here on Monday that a high-level meeting was chaired by Secretary General, Ministry of Finance Mr Moeen Afzal here on Tuesday which discussed the current “exceedingly tough situation” due to which various broad budgetary projections were unlikely to be met.

The meeting took into account the State Bank’s report released on Monday that warned not to underestimate the initial disruption in economic activity being experienced in the wake of the Sept 11 events. “The delay in getting some interim support from the US-led coalition and the International Financial Institutions (IFIs) is causing serious difficulties for which the issue is being taken up with the United States,” an official said.

He said the federal authorities were much concerned about the rising insurance and freight charges which were hurting exports and causing reduction in imports.

But the shipping lines said on Monday in London that they had slashed by 20 per cent the war surcharges which were slapped on cargoes to Pakistan.

Sources said that Punjab and Sindh did not believe that there will be 20.1 million tons of wheat this year. Similarly, they differed with the government’s projections of having over 11 million cotton bales.

“Rice production is likely to be less than 3.8 million tons as against the projected 4 million tons and all of this is happening due to the 50 per cent reduction in water resources,” an official said, subscribing to the view of the two big provinces that federal projections were over-optimistic and were made only to play to the gallery.

“Except for sugarcane, the production of wheat, cotton and rice is less than the estimates due to which it would be difficult to even achieve 3 per cent GDP growth against the 4 per cent fixed for 2001-2002,” said a top official of the ministry of food and agriculture.

A senior source at the Chief Executive office said that farmers did not get Rs300 procurement price for wheat last year due to which they were not very much interested in sowing this crop.

“This may lead to less wheat production this year,” he said, adding that influential farmers had sold their 3.5 million tons of wheat at Rs300 per forty Kg while small farmers were offered the price of Rs230 to Rs250 for their 2.5 million tons of wheat.

Independent economists believe that in case the air strikes against Afghanistan continue for some time, there will be a steep fall in exports, imports, revenues, investment and, at the same time, the country’s manufacturing sector will also suffer very heavily.