KARACHI, March 28: The government is actively considering a proposal to increase the support price of wheat to Rs600 per 40kg from Rs510 fixed by the last government.

The decision, if taken promptly, will settle the unrest in the wheat belt of the country and kick-start the process of procurement for the required stocks of the key food crop. These stocks are crucial for ensuring a steady supply of the commodity to the market to ward off the danger of its shortage.

Sources in Islamabad confirmed that an announcement in this respect was likely next week. The current international price for 40kg wheat is said to be over Rs1,100.

“We have recommended an increase in the support price of wheat for procurement, raising it to Rs600 per 40kg from Rs510 announced by the former government,” said Sartaj Aziz, former finance minister and PML-N leader, when reached by Dawn for his party’s position on the issue.

“We have demanded the support price of wheat be raised to Rs700 as the cost of input has increased dramatically over the past few years,” Qmaruzzaman Shah, president of the Chamber of Agriculture, told Dawn.

Mr Aziz felt that prices of essential food commodities should not be allowed to rise beyond the buying capacity of the less-privileged segments of population.

“If we allow the international price for wheat, the wages will have to be increased subsequently as at the current level of minimum wage it will not be possible to sustain a family if flour price rises above Rs16 per kg,” he said.

“By keeping the wheat support price at such a low level the government is creating scope for rent seekers, hoarders and smugglers. You are depriving the farming community of their due premium and the final beneficiary will not be Pakistani consumers but people of bordering countries. The local consumer will still be forced to buy expensive atta because much of the crop will find its way to foreign markets,” Qmaruzzaman Shah told Dawn.

Mr Aziz accepted that the huge gap between local and international prices encouraged smuggling and hoarding but said he felt that interests of both the farming community and general consumers needed to be served.

“We will have to check elements which could take advantage of this anomaly, and will try to bridge the gap between local and international prices over the next two years by further raising the support price next year. But the process has to be gradual as any erratic movement in the price of basic food items is not advisable,” he added.

The farming community was not ready to buy the argument and advocated direct subsidy to consumers, instead of putting pressure of the subsidy on the farming community that had been tilling the land against all odds.

“Why is the farming community, enduring the pains of surging oil prices and cost of other inputs, denied the gains of better prices for their produce because of rising agricultural commodity prices in the international market?” asked a wheat grower from Multan.