Punjab, centre rift emerges over wheat procurement

Updated 19 Sep 2020

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Sindh and Khyber Pakhtunkhwa had endorsed and agreed to procure 0.150 million metric tonnes each through the TCP on terms, conditions and the cost of wheat at Rs1,910 per 40kg. — AFP/File
Sindh and Khyber Pakhtunkhwa had endorsed and agreed to procure 0.150 million metric tonnes each through the TCP on terms, conditions and the cost of wheat at Rs1,910 per 40kg. — AFP/File

ISLAMABAD: The Punjab government on Friday disagreed with the federal government on the proposal to procure wheat through the Trading Corporation of Pakistan (TCP) at Rs1,900 per 40kg.

Sindh and Khyber Pakhtunkhwa had endorsed and agreed to procure 0.150 million metric tonnes each through the TCP on terms, conditions and the cost of wheat at Rs1,910 per 40kg.

The Economic Coordination Committee (ECC) had directed the TCP last month to import 0.2m metric tonnes of wheat for procurement by the Pakistan Agriculture Storage and Services Corporation (Passco) and directed the Ministry of National Food Security and Research and Economic Affairs Division to get endorsement from provinces.

Punjab government has insisted on the procurement of imported wheat at the control rate of Rs1,400 per 40kg.

However, the Ministry of Finance did not agree with the proposal and viewed that the province either bear the entire cost of the TCP or allow the Finance Division to make at-source deduction.

In its meeting on Thursday, the ECC discussed in detail the need to import wheat in adequate quantity through public and private sector as per the country’s requirement and maintain sufficient strategic whear reserves. It was decided that the TCP will import wheat in adequate quantities from time to time to cater for the national requirement at a reasonable price.

It may be recalled that the ECC on June 10 this year had approved import of 1.0m tonnes of wheat through private sector by waiving off all duties and taxes. The federal cabinet while ratifying the ECC decision a week later directed the committee to decide on open-ended import of wheat or otherwise.

On July 15, the ECC re-affirmed its earlier decision of import for unlimited period and directed to explore opportunity for the import of wheat on government-to-government basis and asked provincial governments to exempt the imported wheat from the anti-hoarding act and waiver off provincial taxes on wheat imports.

Consequently, in line with the ECC decision to allow public sector to participate, a summary was moved to the cabinet for import of 1.5m metric tonnes of wheat through the TCP with exemption of the Public Procurement Regulatory Authority Rules, 2004 and all duties and taxes of the federal government.

Published in Dawn, September 19th, 2020