Pakistan: ECC recommends shift in wheat policy to relieve federal burden

Pakistan’s Economic Coordination Committee (ECC) has recommended deregulating the procurement and distribution of wheat to relieve the federal government of its liabilities after Khyber-Pakhtunkhwa (K-P) declined to lift its allocated imported wheat stocks.

During a recent ECC meeting, chaired by the Ministry of National Food Security, the K-P government stated its willingness to take wheat stocks from Pakistan Agricultural Storage and Services Corporation (Passco) as needed. However, the Ministry noted that K-P and other agencies initially requested the imports, obligating them to accept the supplies in a 50:50 domestic-to-imported ratio to prevent an Rs87.2 billion liability for the federal government. The ECC approved this allocation ratio for most regions, setting it at 75:25 for Gilgit-Baltistan (G-B) due to local preference for domestically produced wheat.

Passco was instructed to conduct lab tests to verify the quality of the imported wheat following supply delays. The ECC also directed Passco to establish a reliable testing mechanism to ensure quality during procurement.

Passco’s carry-forward stock for the 2024-25 food year includes both domestic and imported wheat, totaling 1.266 million metric tons. However, only 0.266 million metric tons were lifted by September 2024, leaving 1.132 million tons unclaimed. Specifically, K-P did not lift any of its 143,618 metric tons allocation, while the Utility Stores Corporation and other agencies lifted partial amounts, leaving significant quantities unused.

The ECC has recommended that all regions and agencies lift wheat supplies at a 50:50 domestic-imported ratio to avoid losses for Passco. It also asked the Finance Division and food ministry to collaborate on addressing Rs193 billion in outstanding dues by December 2024.

The ECC previously approved a 50:50 ratio for all agencies except G-B, which received 100% domestic wheat until a permanent solution is found. With an estimated Rs67.2 billion value for the imported stock, this strategy aims to help the federal government mitigate losses and ensure efficient wheat management across agencies.

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Tags: Pakistan, wheat, imports, stocks, procurement, Market, Economic Coordination Committee, ECC