ISLAMABAD, Aug 18: The first shipment of 500,000 ton wheat will be arriving in the country next month aimed at improving the supply situation that had earlier caused discord between Punjab and the NWFP.

"All efforts are being made to have the first shipment as early possible during September. Another half a million tons of wheat will reach Pakistan in October," said Dr Ashfaque Hasan Khan, economic adviser to the ministry of finance.

Talking to Dawn on Wednesday, he said that concerned departments had been directed to ensure that there was no delay in the shipments once the tendering process was completed.

He said the proposed shipments would cost $212 million and added that the import, being carried out in accordance with an Ecnec decision, would help stabilize prices and reduce their rising effect on inflation which was being monitored in 37 cities.

He expressed the hope that with the arrival of shipments the inflation rate would come down. Dr Khan said the private sector borrowers, who had taken bank loans for wheat operation, would be repaying their loans by September. "These borrowers will bring wheat to the market even if they had hoarded it earlier and this will further help reduce its prices, he maintained said.

Dr Khan, who also holds the portfolio of director-general of debt coordination office, said that 1 million tons of imported wheat combined with the wheat that had already been purchased by the private sector would have good impact on Consumer Price Index.

Referring to the inflation rate which was around 9 per cent, he said: "The government is fully aware of this trend and keeping a close watch on inflation which is high but not threatening."