EDITORIAL: Surely, the new prime minister, and his cabinet would have liked to settle in to better news than the danger of missing this year’s wheat production target.
It turns out that, unless things get worse, the country is only likely to produce 29 out of the targeted 32 million tons of the commodity this season. Wheat is the people’s staple food, after all, so the chain reaction of market shortage, higher price, unscheduled imports, and yet higher price is now certain to play out.
And since this news has come on the heels of the usual Ramazan effect, with food prices driving inflation higher once again, the new government will find public goodwill in very short supply.
The reason for this expected shortfall, according to the press, is a combination of “high energy costs and manipulation of urea price”. Rising input cost, because of IMF’s (International Monetary Fund’s) power and gas tariffs, etc., is not surprising and somebody from the PDM (Pakistan Democratic Movement) or the caretaker administration must now answer why it was not factored in when the annual projection was made. But the urea price issue is an entirely different matter. It’s been reported that farmers were forced to pay double the actual price, as high as Rs5,000 per bag, because of the “alleged monopoly of the fertiliser sector”, and that the industry “could not take action against price manipulation”. Also, the best that the caretaker setup cared to do was refer a “case against fertiliser manufacturers to the Competition Commission of Pakistan (CCP)”.
It’s a shame that the mechanism in place to check monopolistic practices and price management is clearly completely dysfunctional. At the end of the day, farmers will earn less, people will pay more, and the same old highwaymen will laugh all the way to the bank, as always, with the government still not bothered enough to break this pattern. On top of this, the food chain will be disrupted even more because provinces are just not willing to set uniform prices of wheat, which will give nightmares to Passco (Pakistan Agriculture Storage and Supplies Corporation) in its commodity procurement drive very soon. In December last year, ECC (Economic Coordination Committee) of the cabinet approved a “profitable” support price of Rs3,900 per 40kg for the wheat crop of 2023-24. But Sindh and Balochistan governments revised it up to Rs4,000 and Rs4,300 per 40kg, respectively, effectively preventing Passco from buying from them and leaving farmers to suffer even more because they will not be able to fetch “fair returns”.
This, then, is yet another one of those self-inflicted wounds for which only the government of Pakistan is to blame. Politicians that bend over backwards to protect democracy and represent us as well as bureaucrats in the civil service are both too incompetent and/or corrupt to manage the people’s affairs and/or protect their interests. Now, just because of the lot that runs this country, its citizens will be forced to pay more than fair price for less than their fair share of food.
Copyright Business Recorder, 2024
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