National wheat board may be formed to avert future crisis

Published February 8, 2020
The govt has allowed import of 3m tonnes of wheat to avoid shortage, issues related to taxes are yet to be resolved.  — Dawn/File
The govt has allowed import of 3m tonnes of wheat to avoid shortage, issues related to taxes are yet to be resolved. — Dawn/File

ISLAMABAD: The Sen­ate Standing Committee on National Food Security and Research concluded on Friday its three-day discussion on the wheat shortage in the country, and a consensus emerged on the setting up of a wheat board at the national level to handle the issue as a whole.

Committee chairman Muzaffar Hussain Shah, who moved the proposal for setting up of a board, stated that assessment of the wheat crop every year started late and it was made available in November, while the crop harvesting in Punjab and Sindh completed by May.

Even that assessment proved to be inaccurate, triggering the situation that was faced by the country today, he said.

Mr Shah later told Dawn that he would submit recommendations to the Senate to address the issue on a permanent basis.

Though the government has allowed import of three million tonnes of wheat to avoid its shortage, issues related to taxes are yet to be resolved. The government has waived the regulatory duty of 60 per cent, but the issue of six per cent withholding tax is still unresolved.

National Food Security and Research Secretary Mohammad Hashim Popalzai informed the committee that the Federal Board of Revenue had been approached to waive withholding tax.

He said that wheat from Kazakhstan could reach Pakistan by train within 15 days, and this proposal was being actively considered, since Kazakhstan had surplus wheat stocks.

The harvesting of wheat in Sindh begins in the middle of March and is completed within a month, whereas the harvesting in Punjab starts in mid-April and ends by mid-May.

Mr Shah was of the view that when the harvesting of wheat in the country was completed by mid-May, then there was no reason for the supply of data in November.

The committee was informed that no province exported wheat, except the Pakistan Agricultural Storage and Services Corporation (Passco), which exported 163,000 tonnes. Punjab lost two million tonnes of wheat due to excessive rains last year. Yellow rust also damaged the crop.

While in Sindh the wheat production was recorded at over 21,000 tonnes, the provincial government did not procure wheat. Moreover, the Sindh government lifted stock from Passco with a considerable delay.

About the wheat board, Mr Shah said representatives of the federal and provincial governments, agriculture and food departments, growers and all stakeholders, including fertilisers, pesticide and seed industry, should be included in it.

The committee chairman said that the board should also set the wheat production target and decide the support price based on the prevailing market prices.

Senator Sajjad Hussain Tori suggested that if accurate data on wheat production was made available on time, the provinces would be able to procure wheat according to their needs, and by this way crisis could be averted.

The private sector should be kept under observation so that they could not export wheat beyond a fixed quota. At the same time, flour mills should take measures to avert any wheat or wheat flour crisis in the country.

The Passco managing director spoke of poor response from the Sindh government in lifting the wheat quota for the province. The Sindh government lifted its stock in December and January, but it was too late to handle the shortage.

The Sindh chief secretary did not respond to letters written by Passco for lifting the wheat stock, he said.

Meanwhile, the visiting International Monetary Fund staff mission held a meeting with Minister for National Food Security and Research Makhdoom Khusro Bakhtyar on Friday to discuss high food prices and food security issues.

Mr Bakhtyar informed the IMF team that the government was taking all necessary measures for management of food inflation. The mission was informed that a bumper wheat crop was expected this year and there would be no issue of wheat supply in the coming months.

Published in Dawn, February 8th, 2020

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