November 20, 2003

 

 

Pakistan Abolishes 25% Import Duty on Wheat

 

Pakistan said Thursday it will further review the stock position in the country before making a decision to import wheat, Finance Minister Shaukat Aziz said Thursday.

 

Pakistan's food and agriculture ministry has proposed importing at least 500,000 metric tons of wheat to maintain its strategic reserves and stabilize rising prices in the local market.

 

"We've decided to further study the supply situation in the country before making any decision on this issue," Aziz told Dow Jones Newswires.

 

Pakistan has targeted wheat output to reach 20 million metric tons in fiscal 2003-04, up from actual output of 19.25 million tons in 2002-03.

 

Pakistan's wheat output was about 19.25 million tons during the last 2002-03 crop year, short of the target of 19.70 million tons due to unusually hot weather at the time of planting.

 

A government statement issued later said the Economic Coordination Committee reviewed the wheat situation in the country and decided to abolish a 25% import duty on wheat.

 

"The total wheat production was sufficient for the consumption requirement of the country and both the federal and provincial governments will insure the adequate supply of wheat in the country," the statement said.

 

There is no restriction on wheat imports in Pakistan by the private sector. But the government is required to maintain the strategic reserves of the commodity to stabilize prices and to ensure adequate supplies.

 

Pakistan Wednesday also decided to increase the wheat support price - at which the government would intervene in the market to purchase grain - at 350 rupee ($1=PKR57.18) for 40 kilograms, up from PKR300/40 kg last season. This was the first increase in six years.

 

"This will go a long way in not only increasing the production of wheat in the country but will also increase the incomes of the farming community," the statement said.