ISLAMABAD: Trying to strike a balance between rural and urban political and inflationary considerations, a sub-committee of the Economic Coordination Committee (ECC) of the Cabinet on Wednesday finalised Rs1,600 per 40kg as minimum support price (MSP) for upcoming wheat crop.
Earlier this week, the ECC had formed a sub-committee to thoroughly evaluate the proposal for an increase in the MSP of wheat for 2020-21 crop after ministers with political and economic backgrounds disagreed over Rs1,745 per 40kg support price proposed by the Ministry of National Food Security & Research (MNFSR).
The sub-committee — comprising Minister for National Food Security & Research Syed Fakhar Imam, Adviser to the Prime Minister on Finance & Revenue Dr Abdul Hafeez Shaikh, Dr Ishrat Hussain, Dr Waqar Masood Khan, Nadeem Baber, Abdul Razak Dawood, Asad Umar and Khusroo Bakhtiar — met on Wednesday ahead of a routine meeting of the ECC and decided to fix Rs1,600 per 40kg as MSP for the coming crop. Simultaneously, the sub-committee also decided to extend about Rs1,000 per 50kg subsidy on DAP fertiliser in the upcoming crop for farmers to ensure lower input cost and thereby keeping the MSP on the lower side.
The sub-committee directed the MNFSR to move a summary based on its recommendations to the ECC for a formal decision.
Soon after the sub-committee’s session, Dr Shaikh presided over a meeting of the ECC to take up a summary moved by the Ministry of Industries and Production for the supply of regasified-liquefied natural gas (RLNG) to fulfill the requirements of two fertiliser plants — Agritech and Fatima Fertiliser — for rabi season 2020-21.
The ECC decided that the supply of RLNG shall continue till the end of November 2020. It also directed a three-member committee — led by Minister for Industries & Production Hammad Azhar and comprising members from the Ministry of Finance and MNFSR — to prepare a proposal for the further operation of these plants after the said period and then bring it to the ECC for further decision.
Over the past two weeks, the ECC has been struggling to increase MSP of wheat by 25 per cent to Rs1,745 per 40kg from Rs1,400 amid rising flour prices in the market. The increase in wheat support price by 5pc is estimated to have about 1.5pc increase in overall inflation. Wheat flour prices have already increased by almost 50pc under the current government.
For the support price of wheat crop 2020-21, Punjab — the largest producer of the commodity — proposed Rs1,650 per 40kg while Khyber Pakhtunkhwa and Balochistan have proposed Rs1,800 and Rs1,745 per 40kg, respectively. Sindh has not conveyed its recommendation on the issue so far.
On Monday, the ECC had desired rationalising the prices of inputs for making them more affordable to the farmers, to support the rural economy through various measures and to increase the supply of wheat in the market so that the flour prices were brought down.
On Wednesday, the ECC approved two Technical Supplementary Grants for the Ministry of Defence for Rs17 billion during the current financial year. This included a Rs16.5bn for Special Security Division-South that had been raised for the security of China-Pakistan Economic Corridor (CPEC). Another Rs500 million would be utilised to beef up security along the Line of Control (LoC).
The ECC also approved the request of the Ministry of Commerce for the inclusion of radiation apparatus in annex-B-1 of the Import Policy Order, 2020.
Published in Dawn, October 22nd, 2020