Meaningful intervention in the market by building strategic reserves of basic commodities including wheat, sugar, edible oil, ghee, vegetables and pulses to prevent hoarding and undue profiteering is important, said Finance Minister Shaukat Tarin.

Chairing the National Price Monitoring Committee (NPMC) meeting on Monday, he stressed that the government would flood markets with necessary commodities to bridge the demand and supply gap, where needed, to check price hike.

“Pakistan is a net importer of key food items such as wheat, sugar and pulses,” he said. “The current surge in international food prices amid the coronavirus pandemic makes it necessary to build strategic reserves of essential commodities to bring stability to prices of daily-use items.”

While reviewing the current market prices and stocks of sugar, the finance minister constituted a sub-committee comprising the food secretary, industries secretary, Federal Board of Revenue (FBR) chairman, Trading Corporation of Pakistan (TCP) chairman and a representative of the Ministry of Commerce.

He tasked the sub-committee to expedite the import of 0.6 million tons of sugar to ensure smooth supply across the country.

The finance minister expressed satisfaction over the performance of food ministry and asked it to complete the procurement of wheat and sugar in phases, keeping in view the prevailing international prices.

He also urged the food secretary to look into the financial hedging of risks with reference to the import of key commodities.

Tarin told Ministry of National Food Security and Research Secretary Jamshed Cheema to work out modalities for establishing commodity warehouses, storage facilities and agricultural malls on the basis of public-private partnership (PPP) and present the proposal to the committee.

Cheema stated that a proposal had been finalised in this regard and it would be presented shortly for approval.

He updated the NPMC about the availability of sufficient stocks of wheat in the country. The secretary also apprised the committee of the ongoing efforts aimed at purchasing wheat.

TCP Chairman Riaz Memon informed the NPMC about the tenders floated in the international market for the purchase of wheat and sugar.

READ Policy should be outward-looking

Speaking on the occasion, Competition Commission of Pakistan (CCP) Chairperson Vadiyya Khalil highlighted the stern action being taken to end cartelisation in the edible oil and ghee sector in a bid to ensure fair competition in the country.

The finance minister directed the CCP chairperson to accelerate efforts and present a detailed report to the forum at the earliest.

Earlier, Finance Secretary Yusuf Khan briefed the meeting about trends in the weekly Sensitive Price Indicator (SPI), which increased marginally by 0.12% last week.

Prices of six items including chicken, eggs, wheat flour, onion and tomato declined whereas rates of 23 items remained stable.

NPMC also reviewed the year-on-year change in prices of international commodities and noted a massive hike in prices of major food items.

During the year, the international price of sugar registered a 44.4% increase, palm oil 52.3%, soybean oil 78.8% and wheat 18%.

In Pakistan, the sugar price registered an increase of 19.33%, edible oil 27.25%, vegetable ghee 29.40% and wheat 11.77%. The government absorbed the pressure by giving subsidies and importing staple food items in order to provide maximum relief to the consumers.

Similarly, there was a big increase in the price of crude oil, estimated at 73.8%, in the international market, but the government of Pakistan reduced the levy on petrol and petroleum products.

Global food prices soared on the back of supply chain disruptions caused by the Covid-19 pandemic.

Published in The Express Tribune, August 10th, 2021.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.