ISLAMABAD: The federal cabinet has taken serious notice of Trading Corporation of Pakistan’s (TCP’s) “lacklustre” approach to looming wheat crisis in the country, well-informed sources told Business Recorder.
Chairman TCP, Rizwan Memon, at a recent meeting of National Assembly Standing Committee on Commerce, argued that as the ECC issues a press release to import heavy quantity of wheat, international prices rise. He opined that ECC should not issue such statements. Fear of NAB action also came under discussion in the meeting, which is the main reason for TCP's low interest in importing wheat.
The Commerce Division stated that the Import Policy Order (IPO), 2020, allows import of wheat subject to the condition of pre-shipment inspection by five agencies of IPO, 2020. The same provision was also included in the IPO, 2016.
The source said TCP had approached the Commerce Division and stated that choices of Pre-Shipment Inspection Agencies (PSIAs) available for inspection of wheat, being imported by TCP are very limited. Out of five PSIAs, authorized for pre- shipment inspection for imported wheat as per IPO 2020, only two companies M/s Control Union Netherlands and M/s Intertek Testing (U.K). Had agreed to sign the agreement with TCP for pre-shipment inspection work. TCP had already appointed these companies as PSIAs for the quantities of 220,000 MT and 110,000 MT (5+ACU-) awarded to the suppliers of wheat. TCP was also expected to procure further substantial additional quantities of wheat.
The Cabinet was also informed that multiple contracts would be required to achieve the procurement of remaining quantity which could not be performed by two PSIAs in a satisfactory and competitive manner. Therefore, TCP had requested that the names of following PSIAs may also be considered for allocation of pre-shipment inspection for current import of wheat assignments: (i) M/s. Bureau Veritas Pakistan (Pvt). Ltd. The name of foreign associate pre-shipment agency was M/s. Bureau Veritas France +ADs- (ii) M/s Baltic Control Pakistan- with name of foreign associate pre-shipment agency was M/s Baltic Control Ltd. Aarhus, Denmark+ADs- (iii) M/s Atlantic Surveyors (Pvt) Ltd with foreign associate pre-shipment agency M/s Geo Chem Middle East, Dubai, UAE and+ADs- (iv) M/s Inspectorate Pakistan (Pvt) Ltd with foreign associate pre-shipment agency M/s Cotecna Inspection, Switzerland Commerce Ministry said the power to allow import in relaxation of any condition of IPO, 2020, rests with the Federal Government as per para 21 of IPO, 2020.
The Commerce Ministry sought the approval of the Federal Cabinet to allow one-time permission to other pre-shipment agencies mentioned in the summary to carry out pre-shipment inspection for import of wheat by TCP.
During a discussion, it was enquired whether PPRA Rules would be applicable in the instant case. The Commerce Ministry opined that since no payment of government was involved, the PPRA Rules were not relevant. The Minister for Law +ACY- Justice, however, opined that PPRA Rules would be applicable even though direct payment by the government was not involved.
It was pointed out that despite instructions of the Cabinet to import 1.5 MMT of Wheat TCP till date had only imported 330,000 MT. The delay would lead to another crisis-like situation. Adviser on Finance +ACY- Revenue revealed that a meeting with the relevant Minister was called and TCP was given the go-ahead to purchase at the lowest quoted price, which would be approved by ECC. To his utter surprise the TCP Board decided to cancel the tender. It was noted that in addition to public sector, around 700,000 MT had been imported by the private sector. Fears were expressed that the large quantity in private hands could adversely impact price stability and there was an urgent need for the government to maintain buffer stocks.
The Cabinet expressed serious concern over the +IBw-indifferent+IB0- way TCP was handling the import of wheat. It was stressed that the government, under no circumstance, could afford another wheat crisis which the primary staple diet of the common man and directed the Sponsoring Division to consult the Minister for Law +ACY- Justice, and resubmit the summary in light of the advice thereof.
The Cabinet directed Adviser to the Prime Minister on Finance +ACY- Revenue Dr Hafeez Sheikh to oversee and ensure timely import of wheat.
Copyright Business Recorder, 2020
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