April 6, 2010

Pakistani government under pressure to allow wheat export

A powerful wheat exporters' lobby is reportedly trying to trap the Pakistani government into a situation that would benefit speculators, fleece farmers and leave consumers at the mercy of millers.

The present government's predecessor had committed the same mistake in 2007. "If the government allows export of wheat, it will create problems for both the consumers and farmers on the plea of unavailability of warehouses for stocking the commodity in the public sector level," an official of the Food Ministry said.

The federal cabinet will consider the disposal of carryover stock of 3.5 million tonnes of wheat lying both with Pakistan Agricultural Storage and Services Corporation Ltd (PASSCO) and provincial food departments and also the procurement plan for the new crop.

The meeting of the Economic Coordination Committee (ECC) of the Cabinet held on March 30 had deferred the surplus export of the commodity by asking the Ministry of Food & Agriculture to come up with accurate and final estimates expected in April.

However, Agriculture Development Commissioner Dr Qadir Bux Baloch, when asked for comments on the issue said, "It is not the right time to allow the export of wheat. The government should keep in mind the bitter experience of the previous government in allowing wheat export during procurement."

All the procurement agencies should dedicate their energies and resources to the procurement of the grain from farmers so that the budgeted funds of PKR25 billion (US$300 million) for wheat import could be diverted to other sectors, Baloch added.

The federal cabinet on October 20, 2009 had allowed the export of 0.2 million tonnes of wheat products only. The decision got a dead response from commodity exporters who later demanded an export subsidy on the commodity. The government rejected the demand.

The Ministry of Commerce had notified the export of 500,000 tonnes of wheat, particularly to Afghanistan, on January 20, 2007. The ECC on May 15 allowed wheat export but cancelled its decision on May 23, but by then more than 400,000 tonnes of wheat were exported.

Pakistan exported 1.75 million tonnes of wheat during 2002-03 on better demand from the Middle East and African regions before the government banned the commodity's export. India also had put on hold its wheat export plan till June when the procurement would be completed.