April 17, 2008	Thursday	Rabi-us-Sani 10, 1429

LAHORE, April 16: In a policy somersault after experimenting with free wheat trade for five years, the Punjab government on Wednesday “threw the private sector out of procurement and restricted millers to buy wheat not more than 72-hour of their grinding capacity to avoid hoarding and artificial shortage.”

Secretary Food Seerat Asghar announced the decision at a press conference here, claiming that the millers, being a stakeholder in wheat trade, could procure it from anywhere in the province. (This is reversal of the earlier decision to restrict buying within the district of their location.) And only the licence-holders would be allowed to procure wheat.

The Punjab government would procure three million tons of wheat for itself and another 1.3 million for the NWFP and Balochistan. The State Bank of Pakistan had approved a credit limit of Rs53 billion for wheat procurement drive which officially started in the province on Wednesday, he said.

Flanked by Director Food Waseem Mukhtar, the secretary said the credit limit had been sanctioned at the rate of KIBOR plus one. He denied ban on inter-provincial or inter-district movement of wheat, saying the department was only monitoring movement of flour made by subsidised wheat provided by it. “The department is only making sure that such flour should not drain out of the province,” he said, adding that the Rangers and other agencies were helping the food department at exit and entry points in the province.

Dilating on the procurement campaign, he said 345 centres had been set up throughout the province and the nearest bank branch to any centre had been assigned the task of ensuring speedy payment to the farmers. The limit of gunny bag issuance had also been increased and 64 per cent of it had been supplied to the centres before the drive.

He was optimistic that ground realities had changed this year and flour crisis would be not as much as it was last year. There was much difference between the support price and international price of wheat this year and enhanced support price would enable the food department to meet the target, he said.

Answering a question regarding recovery of 1.5 to 2kg more wheat at procurement centres, the official said departmental action would also be taken for all such irregularities. He urged the media to play a positive role by highlighting such issues.

MILLERS’ REACTION: The millers, however, resented the new policy of restriction, saying ‘inconsistency’ had always plaqued policies in Pakistan. “For the last five years, the government, under pressure from donors, has been inducting the private sector in wheat trade and this year it has suddenly been thrown out of the process,” regretted Khaleeq Arshad of Pakistan Flour Mills Association.

He said the middlemen (arhtis) had been asked not to procure wheat on behalf of the millers; in fact, the entire policy had turned topsy-turvy as its contours were still not clear.

Weather had delayed wheat harvesting and increased moisture content, making it impo-

ssible to supplement wheat from the open market and deal with the current flour crunch, he said.