Punjab and Sindh Resist Imported Wheat Purchase, Leaving Federal Government in a Dilemma

KARACHI: The federal government is facing a difficult situation after Punjab and Sindh expressed reluctance to purchase imported wheat, just days after the government decided to import 1 million metric tons of wheat to control rising prices and maintain strategic reserves.

According to official sources, the two major provinces facing wheat shortages have changed their positions regarding the purchase of imported wheat and have yet to provide their views on the proposed tripartite agreement.

The federal government now has to decide whether the cost of imported wheat should be borne by federal resources or whether the import plan should be abandoned. Officials warn that abandoning the plan could increase the risk of wheat shortages and further price increases in the future.

A federal cabinet member said the provinces had been asked for the final time to clearly communicate their wheat requirements in writing and confirm whether they needed imported wheat. He said the wheat currently available in federal stocks was insufficient to meet the requirements of all provinces, making imports necessary.

According to sources, representatives of the provinces maintained during meetings held on August 9 and Wednesday that they wanted locally procured wheat from federal reserves rather than imported wheat.

Prime Minister’s Coordinator for Agriculture Ahmed Amir said the federal government had the authority to provide wheat from its reserves to the provinces. It was decided that both locally procured and imported wheat would be supplied to all provinces on a proportionate basis.

Punjab had initially indicated that it would purchase 1 million metric tons of wheat but later reduced its demand to 800,000 tons. During the August 9 meeting, Punjab’s representative clearly stated that the province did not require imported wheat.

Sources said Federal Minister Rana Tanveer Hussain directed that the Punjab representative’s statement be placed on record and warned that the provincial government should not later hold the federal government responsible for any wheat shortage or increase in prices.

Punjab says it has already been allocated 800,000 metric tons of wheat from federal reserves, of which 533,000 tons is still to be lifted from the warehouses of the Pakistan Agricultural Storage and Services Corporation (PASSCO).

Punjab has also procured around 500,000 tons of wheat from farmers, against an official procurement target of 3 million tons.

Meanwhile, the Sindh government also expressed reluctance to receive imported wheat during the meeting. Sindh had previously sought a total of 720,000 tons of wheat, including 500,000 tons of imported wheat.

Despite the provinces’ reservations, a statement issued after a meeting chaired by Deputy Prime Minister Ishaq Dar said the committee had reaffirmed its decision to import 1 million metric tons of wheat to meet domestic requirements, ease price pressures and provide relief to consumers.

According to the Pakistan Bureau of Statistics, the average price of flour in the country has increased by 77.5 percent over the past year. During the current week, the average price of one kilogram of flour stood at Rs132.50, compared with Rs75 during the same period last year.

Government officials said that even if the provinces refuse to purchase imported wheat and insist on receiving locally procured wheat from federal reserves, the federal government may still have to import wheat to maintain its strategic reserves.