KARACHI: Pakistan Economy Watch President (PEW) Dr. Murtaza Mughal’s decision to reduce its role in wheat procurement and increase the role of the private sector is commendable.
The World Bank has suggested that the government limit its role in wheat procurement to strategic reserves only, in light of which it has decided to reduce wheat procurement from 4.2 million tonnes to 3.5 million tonnes which will be gradually reduced to one million tons.
Dr. Murtaza Mughal said in a statement issued here that this decision will reduce the financial pressure on the government. He said that this would stabilize prices and improve supply in the market and reduce grievances. He said that apart from reducing its role, the government has also planned to provide subsidized flour to the poor people which is worthwhile.
The procurement of wheat by government agencies raises many complaints. The revolving credit of the food sector, which was Rs 36.9 billion in 2002, has gone up to Rs 400 billion last year and Rs 560 billion this year. It has been decided to issue Sukuk bonds. He said that it was necessary to increase the role of the private sector in the procurement of wheat as, despite the import of wheat of huge value, the price of flour could not be reduced.