LAHORE: Caught in administrative confusion in the absence of provincial cabinet, the Punjab Food Department on Thursday achieved its previously fixed wheat procurement target of 3.5 million tonnes and now has no idea how to proceed further.

A host of questions, all needing urgent answers, confront the department and provincial wheat market now. Whether to shut procurement off or just slow it down? If department demobilises its procurement staff now, it will be next to impossible to mobilize them again a few weeks down the line in case the next government decides to purchase more wheat to reduce dependence on import. If it continues purchasing, even at much slower pace, where will the money come from and what about the legality of the purchase, without formal approval of the provincial cabinet? The department has no idea.

What adds to the departmental confusion is the fact that it recently moved a summary for an upwards revision of the procurement target by half a million tonnes, given the crisis in the Black Sea region and potential difficulties in importing wheat this year from Russia and Ukraine. The increase was considered necessary, but the cabinet got dissolved before taking the decision, leaving the food department in limbo.

For possible increase in the procurement target later, the department had distributed gunny bags for 4.2 million tonnes. Out of them, 3.5 million tonnes have returned, while the remaining bags meant for 700,000 tonnes of additional wheat are still with the farmers and they would keep trickling to the procurement centres. The fate of these bags has yet to be decided through an administrative decision; whether to get back the bags full of wheat, or recover their cost.

Another dimension was added when the Khyber Pakhtunkhwah government recently requested Punjab to purchase 200,000 tonnes on its behalf and offered to make upfront payment. The prime minister directed Punjab to cooperate. The food department, however, needs provincial authorisation – and cabinet, the decision-maker, is missing.

“Yes, the department is in a fix right now as it does not know how to move forward,” accepts a high ranking departmental official. The department will continue purchasing the wheat, albeit very slowly, and won’t wind up operations, he says. It can certainly add 200,000 to 300,000 tonnes to its tally, which will be less than 10 per cent of the original target, he adds. It will certainly start tapering off, but keep presence in the market – however thin it may be, he says.

The department is now hoping that the administrative confusion gets cleared up early and it comes to know where it stands, both financially and administratively, the official says.

“The department’s role always defines the market,” explains a former official. It enters the market with ready cash of hundreds of billions of rupees and stabilises the market on higher side – protecting the farmers, he says. “As long as it [the department] stays in the market, price does not dip below a certain line. That is why it is necessary to keep department in the market, and governments has done it though proverbial ‘purchase till the last grain.’ Its presence matters, not the volume. Now, if the department is left confused, market could quickly turn volatile and anti-farmer. That is why it should be done quickly,” he suggests.

Published in Dawn, April 30th, 2022