KARACHI, May 6: The government is building up reserves of seven million tons of wheat and has decided to import 250,000 tons at a time when harvest is in full swing in the Punjab and approaching last phases in Sindh.

Farmers are reportedly reluctant to sell their grains to officials at Rs625 for 40kgs despite a virtual state of siege under inter-district and inter-provincial movement restrictions.

On Tuesday, the Economic Coordination Committee decided to go for a quick import of 250,000 tons of wheat just after a decision to increase the procurement target for Punjab to six million tons from three million tons.

The decision comes after the NWFP and Balochistan mount pressures on Islamabad for supply of wheat as Punjab government has put a restriction on inter-district and inter-provincial movement of wheat to counter wheat smuggling to Afghanistan.

Officials of the Sindh food department now feel shy to face the media and answer questions on wheat procurement from farmers.

Reports from market suggest that administrative restrictions on wheat movement are not proving much successful as grains continue to be transported to other areas despite deployment of rangers and police.

“Much more money is now being pumped in the commodity trade after a negative trading trend at the stock exchanges, worsening rupee-dollar parity, international oil price-hike and signs of political instability as doubts emerge on ruling coalition,” observed a Jodia Bazar merchant.

Businessmen were upbeat on the formation of ruling coalition and joining of one political party after the other. But now there seems to be a total confusion and uncertainty gripping the market which is in an ideal condition for manipulators, speculators and hoarders to play their game.

The negative trend in stock exchanges, worsening rupee-dollar parity and rising international oil prices are bringing more money for speculators who have set up a nation-wide network of manipulators to buy and hoard commodities and regulate supplies and create shortages and dictate on prices.

“The real testing time for the ruling coalition will come in the late August and in early September when Ramazan would be there and real sharks of business would show their real strength in the market,” said a trader.

In Karachi, the millers are getting wheat from fresh crop and consumers get flour, but at much higher price than indicated by the government.

“You cannot now expect to get wheat flour at Rs16 or Rs18 a kg,” a business leader said while pointing out that wheat price for millers would be Rs700 to Rs750 for 40kgs.

“Wheat in Afghanistan and in Central Asia is close to Rs1,000 for 40kgs,” he said to stress that wheat is bound to flow out from Pakistan no matter how much forces you deploy.

The only answer to stop wheat smuggling is to increase domestic prices and improve levels of incomes for the urban population.

Different trade bodies and associations and individual businessmen have prepared themselves or are in the process of preparing strategy papers to counter commodity shortages, check price-hike, ensure availability of essential goods to low-income people and contingency measures.

They are seeking interviews with the prime minister, finance minister, chief ministers of the four provinces and other political leaders at various levels.