naeemomer
15th April 2008, 22:52
ISLAMABAD: The government of Prime Minister Gilani on Monday brought the support price and issue price at the same level of Rs 625 per 40 kg and officials admit this would make wheat flour more expensive in the market for people by at least Rs 50 per 20 kg bag.
Amid rising fears of a new wheat crisis set to hit the country the government on Monday abolished the subsidy and enhanced the official issue wheat price by Rs 160. The action was taken after a shocking revelation that flour millers were quietly selling the massive wheat stocks in the open market after purchasing it from the Ministry of Agriculture at subsidised rates.
This raise in issue price would enhance the price of a wheat flour bag of 20 kg by Rs 50 in the open market on the one hand, but might give incentives to the millers to grind the wheat that might help address the current crisis, on the other.
From today (Tuesday), the government would sell the wheat to the millers at the rate of Rs 625 per 40 kg against the six-month old price of Rs 465 and this move is expected to boost the supply of wheat in the market and help ensure constant supply of the commodity. The millers would also buy the wheat at the rate of newly announced official price and thus the prices of a flour bag would also go up.
This decision also indicates that the government has quietly abolished the subsidy which it was earlier giving to the flour millers to provide flour to the consumers at the controlled rates. Earlier, Prime Minister Yousuf Raza Gilani had announced to enhance wheat support price to Rs 625 in a bid to boost the income of the poor farmers, who were desperately crying under the rising cost of production. The decision to enhance the wheat support price was taken after it was reported that government was importing the wheat from Austria and America at the rate of Rs 1200 per 40 kg.
The Ministry of Food, Agriculture and Livestock is providing 35,000 metric tonnes of wheat to the flour mill owners on daily basis from its existing stocks available with the Food Department and Pakistan Agriculture Supply Corporation (PASC)). The government was giving a subsidy to these millers so they could provide the flour in the market at controlled rates. But, now it was reported that the subsidy was being misused by the flour millers as instead of grinding the wheat taken from the government, they were rather selling it in the market at higher prices to earn massive profit ñ Rs 165 per 40 kg.
The long queues outside the utility stores and other shops are said to have been the direct result of big difference between the wheat support price and the issue price. Talking to The News, Secretary Ministry of Food, Agriculture and Livestock Ziaur Rehman hoped that the raise would bring about significant change in the supply of the essential commodity in a couple of days. He also defended the decision, saying the wheat prices in the world had gone up to Rs 1400 per 40 kg but even then the Pakistani government was trying to keep it at minimum level so that the poor people were not hit hard by the raise in the wheat support prices. Zia said we have also to look after the interests of the poor farmers so that they should keep on cultivating the crop in the greater national interest.
Flour price to shoot up (http://thenews.jang.com.pk/top_story_detail.asp?Id=14106)
Amid rising fears of a new wheat crisis set to hit the country the government on Monday abolished the subsidy and enhanced the official issue wheat price by Rs 160. The action was taken after a shocking revelation that flour millers were quietly selling the massive wheat stocks in the open market after purchasing it from the Ministry of Agriculture at subsidised rates.
This raise in issue price would enhance the price of a wheat flour bag of 20 kg by Rs 50 in the open market on the one hand, but might give incentives to the millers to grind the wheat that might help address the current crisis, on the other.
From today (Tuesday), the government would sell the wheat to the millers at the rate of Rs 625 per 40 kg against the six-month old price of Rs 465 and this move is expected to boost the supply of wheat in the market and help ensure constant supply of the commodity. The millers would also buy the wheat at the rate of newly announced official price and thus the prices of a flour bag would also go up.
This decision also indicates that the government has quietly abolished the subsidy which it was earlier giving to the flour millers to provide flour to the consumers at the controlled rates. Earlier, Prime Minister Yousuf Raza Gilani had announced to enhance wheat support price to Rs 625 in a bid to boost the income of the poor farmers, who were desperately crying under the rising cost of production. The decision to enhance the wheat support price was taken after it was reported that government was importing the wheat from Austria and America at the rate of Rs 1200 per 40 kg.
The Ministry of Food, Agriculture and Livestock is providing 35,000 metric tonnes of wheat to the flour mill owners on daily basis from its existing stocks available with the Food Department and Pakistan Agriculture Supply Corporation (PASC)). The government was giving a subsidy to these millers so they could provide the flour in the market at controlled rates. But, now it was reported that the subsidy was being misused by the flour millers as instead of grinding the wheat taken from the government, they were rather selling it in the market at higher prices to earn massive profit ñ Rs 165 per 40 kg.
The long queues outside the utility stores and other shops are said to have been the direct result of big difference between the wheat support price and the issue price. Talking to The News, Secretary Ministry of Food, Agriculture and Livestock Ziaur Rehman hoped that the raise would bring about significant change in the supply of the essential commodity in a couple of days. He also defended the decision, saying the wheat prices in the world had gone up to Rs 1400 per 40 kg but even then the Pakistani government was trying to keep it at minimum level so that the poor people were not hit hard by the raise in the wheat support prices. Zia said we have also to look after the interests of the poor farmers so that they should keep on cultivating the crop in the greater national interest.
Flour price to shoot up (http://thenews.jang.com.pk/top_story_detail.asp?Id=14106)