ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has directed the Secretary Finance, Secretary Kashmir Affairs & Gilgit Baltistan (GB), and Chief Secretary G-B to look into the wheat issue of GB in holistic manner and submit recommendations for its permanent resolution, well-informed sources told Business Recorder.
The decision was taken at a meeting of the ECC held in February 1, 2024 with caretaker Finance Minister, Dr, Shamshad Akhtar in the chair.
The Ministry of Kashmir Affairs and Gilgit-Baltistan briefed the forum that the Federal Government provides the overall budgetary requirements of Government of Gilgit-Baltistan as a grant-in-aid through Finance Division for salaries, operational expenditures, development and wheat subsidy, etc.
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The federal government allocated Rs. 9.500 billion for the CFY 2023-24 to provide 150,000 Metric Tons wheat (75% local & 25% imported) at subsidized rates for Gilgit-Baltistan. However, due to increase in wheat prices, both local and imported, the allocated budget would be exhausted after the supply of 84,998 MTs wheat till January 2024.
The Ministry of Kashmir Affairs and Gilgit-Baltistan argued that stoppage of wheat supply to GB on account of deficit funds, may lead to very serious repercussions and widespread upheavals throughout the region. Earlier, ECC of the Cabinet, in its decision of July 20, 2023 constituted a Committee comprising Secretary Finance Division (convener), Secretary Ministry of National Food Security & Research and Secretary Ministry of KA&GB to deliberate the issue in a holistic manner and submit viable recommendations for “comprehensive sustainable plan for price rationalization of subsidized wheat in Gilgit-Baltistan”.
The Committee held a number of meetings to deliberate upon the issues and propose a comprehensive sustainable plan for price rationalization of subsidized wheat in GB. The latest scenario was considered inclusive of previous years’ release position of wheat to GB, the situation on ground and deliberations held during the meetings of the committee.
The Ministry of Kashmir Affairs & Gilgit-Baltistan, in consultation with the GB Government, submitted following proposals for consideration of the ECC: (i) recently, the GB government has revised the sale price of wheat from Rs. 20/kg to Rs. 36/kg of December 26, 2023 effective from January 01, 2024.
However, the enhanced rates and wheat shortage have sparked protests leading to agitation and law & order situation in the strategically important region and despite extreme weather conditions agitations have persisted; (ii) the ECC decision in 2011 that sale price of wheat for GB may be brought to 70% of the wheat prices in rest of the country is not viable and needs reconsideration in existing circumstances of high wheat price in the country; (iii) existing ratio of 75:25 of local: imported wheat may be made 100% local to reduce financial burden on the federal government. This will reduce the financial requirements by Rs.700.000 million for remaining months of the CFY and by Rs. 1,432.000 million for the next financial year 2024-25; (iv) the GB government shall ensure immediate exclusion of 5th Quintile of BISP beneficiaries from subsidized wheat category. This exercise may save an amount of Rs. 829.880 million for the CFY by excluding a population of 228,054.
As a next step, the GB government shall ensure exclusion of 4th Quintile of BISP from subsidized wheat category after ground verifications; (v) the ECC may consider three year plan of the GB Government for increasing yield/local cultivation of indigenous wheat. GB Government shall ensure to implement the said plan within the defined timelines; (vi) provision of approved quota of 150,000 MT for the CFY and a quantity of 160,000 MT may be approved for the next financial year to avoid food security challenges in GB; (vii) additional funds amounting to Rs. 6.000 billion may be approved by the ECC to cover the wheat shortfall for the CFY; (viii) the GB Government shall ensure participation of the flour mills from GB in the pre-qualification process of Utility Stores Corporation for supply of wheat flour in GB to avoid shortage; and (ix) the ECC may consider inviting the Chief Minister GB, Senior Minister for Food GB, Finance Minister GB and Chief Secretary GB as special invitees to attend the ECC meeting.
The ECC discussed the case threadbare and observed that the issue was complex in nature due to sensitivity of Gilgit- Baltistan area and demanded permanent resolution to avoid food security and law and order challenges in GB.
After detailed deliberation, the forum agreed that Secretary Finance Division and Chief Secretary Gilgit-Baltistan should look into the issue in a holistic manner and submit viable recommendation thereon to the ECC for consideration. The forum also agreed on provision of approved quota of 150,000 MT for the CFY, to the Gilgit-Baltistan.
The ECC further directed that the approved quota of 150,000 MT of 100% local wheat for remaining months of current financial year at subsidized rates shall continue to be provided to Gilgit-Baltistan until a permanent solution is agreed.
Copyright Business Recorder, 2024
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