Sending ‘unfit’ rice to EU: MoC shifts blame to rice exporters, DPP officials

ISLAMABAD: Commerce Ministry on Wednesday accused both rice exporters and officials from the Department of Plant Protection (DPP) of colluding to get cleared “unfit” rice consignments that had been intercepted by European Union (EU) countries.

This issue came under discussion at a meeting of National Assembly Standing Committee on Commerce, under the chairmanship of Javed Hanif Khan, on a calling attention notice of Member National Assembly Sharmila Faruqui in which she had requested the House to “discuss serious disruptions in rice exports from Pakistan to EU resulting in loss to the national exchequer.”

She accused DPP officials of clearing rice consignments on fake certification. Last year 72 interventions were reported by the EU countries. However, in December 2024, interventions were reduced to eight monthly average from 12. Rice exports also showed good growth in December 2024.

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The Committee was informed that the main reason for ‘interventions’ in EU countries was use of excessive or substandard fertiliser and pesticides by the farmers due to which the standards of Minimum Residual Disease (MRD) are not being followed properly. Last year, rice exports earned $ 4 billion.

On a question that EU has raised concerns on ‘unfit’ rice consignments, Secretary Commerce Jawad Paal clarified that the EU has not shown any concern.

Khurshid Junejo and Mirza Ikhtiar Baig also spoke on this issue and pointed out deficiencies on the part of Pakistan.

However, Special Secretary Commerce Shakeel Ahmed Mangnejo briefed the Standing Committee that Commerce Ministry has taken a number of measures to avert such a situation in consultation with the stakeholders, results of which are now being witnessed. A new Organisation is being established in place of DPP which will deal with food security issues.

He also raised questions on the capacity of DPP and stated that the Organisation has improved with posting of officials from outside, as well as, removal of some officials.

The Committee noted that Punjab and Sindh together account for 5 million tons of rice exports, and the interceptions had a significant impact on these exports. However, Secretary of the Ministry of Commerce clarified that no formal warning had been issued by the EU, dispelling any misconceptions regarding the issue.

He explained that the lack of a national framework for food security had led to the proposal for a new empowered authority, which would be better equipped to handle such challenges with improved security and expertise.

On the accusation of corruption in DPP to clear infected consignments, Special Secretary Commerce said that “this is a two-way collusion as exporter would also not have submitted authentic certificate to get clearance of his consignment.”

He said now certification from a German company has been made mandatory; however, this issue can be raised again as consignments reach their destination after 30 days.

Commerce Ministry further informed the Committee that in order to resolve issue and sustain a positive growth momentum in rice exports to the world in general and EU in particular the government has taken the following measures: (i) lifting of Minimum Export Price (MEP) rice; (ii) strengthening phytosanitary inspections and certifications; (iii) improvement of exporter compliance with EU regulations; (iv) awareness campaigns for compliance at farm levels; (v) engagement with EU and international stakeholders; (vi) legislative and regulatory reforms; (vii) strengthening of DPP through restructuring and up-gradation; and (viii) new markets have been accessed and enhancement in current ones.

The Committee decided to discuss this issue in detail in the next meeting, in the presence of officials of Ministry of National Food Security and Research, DPP and rice exporters so that a viable mechanism can be formulated to avoid such a situation in future.

Trading Corporation of Pakistan (TCP) informed the Committee that it has written a letter to Chairman NAB regarding the “closed” inquiry against four sugar mills directing it to transfer the case to FIA.

TCP also informed the Committee that its receivables against 15 public sector entities stood at Rs 305.244 billion, of which principal amount is Rs 93.693 billion whereas Rs 211.550 billion is mark up. TCP sought Standing Committee’s support for resolution of this longstanding issue.

According to official statement, the Standing Committee made several recommendations to improve the functioning of the Ministry of Commerce and the country’s export sector. Among major discussions, the Committee urged the insurance companies operating under the Ministry’s domain to increase their contributions to Corporate Social Responsibility (CSR) initiatives and ensure these funds are effectively utilised.

The Committee also turned its focus to the TCP, urging swift action to resolve long-standing issues of receivables and pending debts, particularly those owed by various ministries and organizations. It was emphasized that clearing these liabilities is crucial for the financial health and operational efficiency of the TCP.

In response to concerns over the default of sugar mills, it was informed that the defaulters had been blacklisted.

The Committee expressed deep concern over this matter. It pointed to quality control issues, particularly in the inspection process, as the root cause of these challenges. It was revealed that the National Food Security Department has not been able to address these quality issues effectively, with the government proposing a new regulatory authority to ensure better oversight.

The Committee also reviewed the government’s ambitious target of Rs. 60 billion in exports by the end of 2029. Members expressed scepticism about the feasibility of achieving this target, urging the Ministry to provide more concrete details on the steps and strategies required to meet this goal. A more detailed plan will be expected at the next meeting.

The meeting was attended by MNAs, Muhammad Mobeen Arif, Usama Ahmed Mela, Muhammad Ali Sarfaraz, Shaista Khan, Rana Atif, Muhammad Ahmed Chattha, Gul Asghar Khan, Muhammad Atif, Kiran Haider and Khurshid Ahmed Junejo in person whereas, Dr. Mirza Ikhtiar Baig, Asad Alam Niazi and Sharmila Sahiba Faruqui Hashaam, attended the meeting virtually. Parliamentary Secretary of Commerce and other senior officers from the Ministry of Commerce, NICL, PakRe, SLIC and TDAP were also present in the meeting.

Copyright Business Recorder, 2025