KARACHI, Aug 18: Adequate administrative and supply side measures are being taken by the government at the federal, provincial and local levels to ensure steady stocking and reasonable prices of wheat flour, bakery products, sugar and pulses during Ramazan, which is now only five weeks away.

Market analysts believe that coming Ramazan may be perhaps the last one before the government gets involved in a full-fledged election campaign by mid-2007, and therefore all possible steps are being taken to ensure a steady supply of essential goods when consumption of certain items goes up and also to maintain a reasonable price level.

The government has already decided to form market committees and appoint price magistrates at the local level. Perhaps the government realizes the ineffectiveness of cosmetic administrative measures. It is, therefore, taking policy measures at the federal and provincial levels to ensure supply and reduce prices.

Only a week ago, the Sindh government has decided to release wheat from government stocks to flour mills in unlimited quantities at Rs430 for 40kg bag. In previous years, the Sindh food department used to release wheat from official stocks on fixed quotas for different flour mills based on the grinding capacity and actual performance. This was done because the government releases wheat from the official stocks on subsidised price.

But then every year, the subsidy on wheat never benefited consumers or growers and it was always shared between officials of the food department and millers because those with clout and influence always managed to get a big quota of wheat. This year, the quota for individual flour mills was done away with to provide every mill out of about 75 in the city to get equal chance to purchase as much quantity of wheat as they can.However, flour mills on Friday raised the issue on quality of wheat being supplied from the official stocks in a meeting with the food department. “Wheat is being supplied in a bag which contains grains from previous years’ crops also,” a senior member of the millers’ association informed Dawn by telephone.

The Sindh department has about 0.9 million tons of wheat in the official stocks. Bulk of this stock —- 0.6 million tons —- has been procured from the farmers only this spring, while about 0.3 million tons is the carryover stock from 2005 and 2004 crops. A small part of 47,000 tons is said to be imported wheat from Australia.

Officials maintain that the bag being offered to the milers contains bulk of wheat from the fresh crop and a small and insignificant quantity is from the old crops. “In no way this can be called unfit for human consumption,” an official explained. The millers want that they should first be given wheat from the 2006 crop and then carryover stocks can be taken later at reduced price.

A committee has been formed to work out disposal of 47,000 tons imported Australian wheat on Wednesday (Aug 23) and hence it does not form the part of wheat being sold to the millers. The millers said wheat prices in the open market went up by Rs20 for a 100kg bag because of this dispute between the millers and the government. The officials reject this assertion and term it a “normal and usual blackmail of the business at the last hour to force the government to give them best at minimum price”.

While this dispute among the millers remains unresolved, the federal government is considering offering its stock of sugar to wholesale traders after September 1 at a discount price to bring down sugar prices further at the retail level during Ramazan. Prime Minister Shaukat Aziz is said to be in touch with the leaders of importers and traders to work out a strategy for bringing down sugar prices below Rs30 a kg in Ramazan.

Sugar is now being sold at Rs36 to Rs38 a kg at the retail level.

According to reports, sugar prices in the international market had crashed to $410 a ton from more than $500 and that current rains had a beneficial effect on the sugarcane crop this season. According to market sources, the prime minister seeks an alliance with the traders and importers to counter the influence and clout of sugar barons who were a part of his government but were working against him.

Hitherto, the government was supplying sugar to the Utility Stores Corporation at a discount but now wants to sell it to the wholesale traders for distribution through retail network across the country. Jodia Bazar leaders say the government is expected to announce the new sugar trade policy on September 1.

Black gram is consumed most as cereal and also as flour in Ramazan. The annual consumption of black gram is around 850,000 tons, but in the month of Ramazan as much as 150,000 is consumed. Raees Ashraf Tarmohammad, leader of importers, said there was sufficient stock of black gram and there would be no shortage as far as supply was concerned. In the current fiscal year budget, the government has offered Rs8,000 subsidy on a ton import of black gram. “We want subsidy grant at the time of opening of letter of credit and not at the time of unloading,” Mr Raees said.

Moong and mash are the other varieties of pulses that are in demand for which there is enough stock with the traders. But no word is available on supply and prices of vegetable ghee and cooking oil. There is a problem in supply of cooking oil, but prices are crawling up much before Ramazan.

Dates are another popular fruit for Ramazan. Sukkur dates are costly and exported entirely. Average Pakistanis relish Iranian and Iraqi dates which are imported on 15 per cent duty. “India and Bangladesh waive import duty on dates during Ramazan,” Mr Raees said while pleading same in Pakistan.

Prices of vegetables are already up after the recent devastating rains, but market analysts believe that crops of a variety are due next month and there should be some improvement in supply during Ramazan. “The government should ensure a regular supply of greens to Karachi and urban centre rather than exercising administrative controls on prices,” Haji Rehman, a well-known vegetable dealer, said.

Same is true for fruits. If the government manages well the supply of bananas, apples and few other varieties, prices will remain manageable is the recipe.But cynics are convinced that no amount of administrative and fiscal measures can protect consumers and at the end of day the speculators, profiteers and manipulators go with bags full of money.