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Sugar and wheat crises reports

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Coronavirus has taken the government’s attention. A large number of the names that have come up in the report are individually or politically near to the PM himself. It must be welcomed though, that the inquiry was ordered and the report was made public on the instruction of Prime Minister Imran Khan himself. In this context if Imran Khan accomplishes in doing the impossible, taking this hard task he would adopt very significant example; even though legally he would only be doing his job. Pakistan’s top most problems are corruption. Governments are unable to do anything about it because they are generally settled peacefully.
The prime minister had established two high-powered committees headed by the director general of the Federal Investigation Agency and consisting a senior officer of the Intelligence Bureau and the director general of the Anti-Corruption Establishment of Punjab to examine the reason behind the turmoil and price escalation of those commodities. After the formation of the committees, the prime minister had many times determined to abolish and punish those found responsible for the sugar and wheat crises to prevent the again occurrence of such acts. The exporters of sugar were able to gain subsidy and, they made profit from the increasing sugar prices in the local market. The committee report disclosed that PTI’s former secretary general Jahangir Khan Tareen and Federal Minister for National Food Security Makhdoom Khusro Bakhtiar were among the main claimants. Sugar mill owners who availed large subsidy had persuaded in decision making and they tried to obtain a lot of benefit in a very small time. The government determination to allow export of sugar led to increase in the retail price, as state in the committee’s main search. The federal and the provincial governments disregarded the warnings of low sugar stocks and increase in prices. Before the decision to allow export of 1 million metric tons of sugar the per kilo sugar price was Rs55 in December 2018 that climbed about Rs71.44 per kg in June 2019 .There were clear signs of manipulation by sugar mills and the ex-mill sugar price determination formula was also unjust. For solid proof, the inquiry committee advised forensic audit of the mills, which has already started. Many policies were sent to the sugar mills of the Pakistan Sugar Mills Association. Prime Minister Imran had established the inquiry committee to know into the sugar crisis after the commodity price increased all of a sudden and substantially in spite of availability of the abundant stocks. The director general of the FIA was assisted by senior representatives of the Intelligence Bureau and the Punjab anti-corruption department.
The committee was of the fair opinion based on document file that the export of sugar was not well- founded as the sugarcane production was anticipated to be low in the forthcoming harvesting season. The committee noticed that it was the responsibility of the cane commissioner to register full sugarcane production whereas the FBR was responsible for registering the sugar production. The committee also saw that the Rs190 per 40 kg sugarcane support price was substantial but the price increase was postponed, denying the farmers from making an informed decision. The inquiry discarded that the Pakistan Sugar Mills Association declaration that it closed mills operations for few weeks due to the lower availability of the sugarcane. It noticed that the mills were closed to bring the prices of the key input down. The provincial governments have not kept any register of stocking the sugar in spite of the fact it is prerequisite under the law, according to the inquiry.
The report depicts that Sindh procured nil tonnes where its target was one million tonnes, and Punjab procured 3.315million tonnes where its target was four million tonnes. The federal government endeavor is supported by the Pakistan Agricultural Storage and Services Corporation and it procured 0.679 tonnes of wheat against a target of 1.1mn tonnes. The inquiry committee was formed on January 22 on instruction of the prime minister to look into the causes of the wheat price escalating that grabbed the country in December. It had three members, with the FIA DG as its convener. The shortfalls in procurement exacerbated an already stiff supply position in the country. Carry-forward stocks from the previous year as well as production in the financial year 2019 were the lowermost in five years, entering in at 3.777million tonnes and 24.479millio tonnes, accordingly. In such circumstances Passco should have been ordered to raise its procurement goal. Passco’s own carryover stocks, at 1.33million tonnes were the minimum they had been in five years in 2019 when procurement began, and called for a higher procurement target as well as more aggressive effort to constructs its reserve to abut2.5million tonnes, which is the least they had been at for the past two years when all procurement objectives were met. Passco could not meet its procurement objective by a space of 40 percent. Whereas Ministry kept saying the ECC in May and June 2019 that Passco had met its procurement aims. The Ministry National Food Security and Research which monitors Passco, also suggested to the government that the wheat stock position is at ease and exports should be permitted. In Punjab the procurement endeavor was hold up by high turnover in the food department, which witnessed four secretaries revolve through the office in one year, and all District Food Controllers were revolve three in the same year. The procurement effort began 20 days delayed, and the food department could not work control on flour mills which used to profiteering campaign as they felt that the government was not ready to control the wheat demand and supply chain. Wheat petty theft increased and the government could not control over wheat supply situation as private and government stocks started leading in every direction, without being assigning for. The report accuses former Food Secretary, Government of Punjab, Naseem Sadiq and former Director Food Dr Zafar Iqbal for these serious mistakes. It also mentions provincial minister food, Samiullah Chaudhry, for not envisioning any reform agenda to solve the continuous illness in the food department. The Sindh government claimed to have 0.8million tonnes of wheat in stock, but the report says these were distressed with so many thefts. Sindh was unsuccessful to interfere in the market early when the prices of wheat started rising as early as August 2019 the report says, and postponed releasing wheat from its stocks till October, giving hoarders a complete free pass.