US to provide $200 million wheat on deferred payment

06 Nov, 2008

The United States will provide wheat worth $200 million to Pakistan, on deferred payment of two years, under GSM-102, while the government has decided to provide $100 million to the Trading Corporation of Pakistan (TCP) for purchase of urea, Business Recorder learnt here on Wednesday.
Earlier, in September, the government had decided to import 0.25 million tons wheat from USA, on deferred payment of $100 million, and another $115 million grant was being given by the US authorities to overcome shortage of wheat in the country. In this regard, the Food Ministry also informed the government that by October, wheat import agreements with US would be finalised.
The country would have to face a lot of problems in case of import of wheat from US, because the American embassy was reluctant to accept all specifications of Pakistan government. Pakistan wanted that each consignment of imported wheat should be checked at American ports, before loading, and cleared by the Plant Protection Authority that the consignment was disease-free. So, the matter got delayed.
In 1996, India had also rejected wheat import from US for reason of inferior quality. Two diseases, Kernel Bunt and Tellitia Walker, are very frequently observed in American wheat, besides several weeds. In international market, the price of wheat is $245, against last year''s $333, per ton thus indicating a decrease of 26 percent over last year. Even the meeting between the representatives of American embassy and the Food Ministry, held on July 31 to finalise the modalities about wheat import, did not prove to be fruitful.
But an official on Wednesday told this scribe that US has agreed to all specifications of Pakistan and it would soon provide wheat worth $200 million in spite of $100 million on deferred payment. The official said that the government has provided $100 million to Trading Corporation of Pakistan (TCP) for import of 250,000 tons urea.
"In this regard, TCP will open tenders on November 11. First tender will be opened for import of 0.1 million tons, while the next one for the import of wheat of the same quantity will be opened on November 30 and, on December 15, a tender for the import of 50,000 tons wheat would be moved", he said.
Use of urea in most parts of the world has increased over past some years. That is why urea consumption in India and China has increased considerably. Pakistan''s requirement of urea in Rabi is 2.6 million tons and, according to official data, the stocks available with the government are of 2.2 million tons. But with an increase in prices of the fertiliser in international market, which touched $800 per ton, the price in Pakistan remained below $200 per ton. This huge difference prompted the dealers to resort to smuggle the commodity. Urea would be imported through both Karachi and Gwadar ports.

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