ISLAMABAD: The Public Procurement Regulatory Authority (PPRA) Board has decided to recommend to the federal government to grant exemption to the Ministry of National Food Security & Research (MNFS&R) from Rules 5 (in case of G2G) 13, 35, 38 & 40 of Public Procurement Rules, 2004 for procurement of 3.0 MMT Wheat through international tender/ or under government-to-government (G2G) arrangement, subject to the condition that fair opportunity shall be provided to the potential bidders, official sources told Business Recorder.

The Ministry of National Food Security & Research, in its summary, noted that it decided to import 3 MMT wheat on G2G basis and international tendering, citing the reasons of a production shortfall, Russia-Ukraine war, Afghanistan situation, higher international wheat prices, hoarding and smuggling issues, and ongoing food inflation.

Sharing the details, the sources said, in the meeting of the Federal Committee on Agriculture (FCA) held on March 31, 2022, Provincial Crop Reporting Services had estimated wheat production at the level of 26.87 MMT against the assigned target of 28.89 MMT, showing a shortfall of 6.97%. In addition to the public carry-forward stock of 1.8 MMT, the total availability of wheat is estimated at the level of 28.67 MMT during the Food Year 2022-23 as compared to the national requirement of 30.79 MMT, leaving behind a net shortfall of 2.12 MMT.

In this regard, the Ministry proposed that 2 MMT of wheat be imported through G2G arrangements from Russia and 1 MMT through international tenders. However, in case of restrictions, the entire quantum of 3 MMT of wheat has been proposed to be imported through the international tendering process by the Trading Corporation of Pakistan (TCP).

Food ministry decides to import 3MMTs of wheat on G2G basis

Ministry of National Food Security and Research in a letter on April 13, 2022, requested the Authority to grant exemption from Rule 5 (in case of G2G), and Rule 13, 35, 38 & 40 of PPRA Rule 2004, for procurement of wheat through international tender/ or under G2G arrangements to build up strategic reserves and to cater for the provincial requirements.

According to Public Procurement Regulatory Authority (PPRA), the Ministry of National Food Security & Research, in a letter on March 14, 2021, requested the Authority to furnish views/ comments on the summary for ECC regarding the demand and supply situation of wheat and approval for import of wheat. In response Ministry of National Food Security & Research was advised through a letter of March 31, 2022, to forward its case to PPRA if it falls within the ambit of national interest, along with detailed justification(s).

Section 21 of the PPRA Ordinance, 2002 empowers the Authority to recommend exemption cases to the federal government if it falls within the ambit of national interest. Such exemption from the applicability of the Rule(s) is evaluated by the Authority on a case-to-case basis and if merits consideration presents the same to the PPRA Board for further deliberation and appropriate decision.

In response to the PPRA letter, the Ministry of National Food Security & Research requested an exemption from, Rule 5 (in the case of G2G), and Rule 13, 35, 38 & 40 of PPRA Rule 2004, for the procurement of wheat for all public import to be made through TCP/ under G2G arrangements, and requested to place the case before PPRA Board.

The estimate of consumption has been calculated on the total population of 237,280,087 which is based on the PBS census of 2021 plus 1.94 percent growth per annum.

The estimated consumption is 28.79 MMT of which Punjab’s consumption would be 13.96 MMT, Sindh 6.08 MMT, KP 3.87 MMT, Balochistan1.57 MMT, FATA 0.63 MMT, Islamabad 025 MMT, AJK 055 MMT, GB 019 MMT, IDP’s 0.16 MMT and seed and feed. In addition, 2 MMT would be required as strategic reserves, which makes total consumption of 30.79 MMT.

PPRA argues that the federal government on the recommendations of the Authority granted a partial exemption to the Ministry of National Food Security & Research from the applicability of rules 5, 13, 35, 38 &40 of the Public Procurement Rules, 2004 for the import of wheat on July 08, 2021. Ministry was also granted exemption from the applicability of rules on March 15, 2021. However, the Ministry of National Food Security & Research is requesting exemption repeatedly.

PPRA has recommended to its Board to advise the Ministry to improve its procurement planning in compliance with Rules 8 & 9 of the Public Procurement Rules, 2004 and improve its coordination with all stakeholders so as to avoid such requests for exemption repeatedly.

On April 30, 2022, PPRA management apprised the Board that earlier in March 2022 the MNFS&R requested this Authority to furnish views/ comments on the summary for ECC regarding the demand and supply situation of wheat and approval for import of wheat.

In response, MNFS&R was advised to forward its case to PPRA if the same falls within the ambit of national interest, along with detailed justification(s). PPRA management further apprised that in response to the above-mentioned letter, MNFS&R has requested exemption, from Rule 5 (in case of G2G), and Rule 13, 35, 38 & 40 of PPRA Rule 2004, for procurement of wheat for all public imports to be made through TCP/ under G2G arrangements, and requested to place the case before PPRA Board for exemption, the same is placed for the consideration of the Board.

One of the Board Members pointed out that the MNFS&R may like to apprise the Board regarding the benefits achieved from previous exemptions granted. The representative of the MNFS&R responded that due to the exemption granted, the MNFS&R was able to meet the wheat requirement timely and it resulted in around 60% cost saving for the national exchequer.

After thorough deliberations, the Board decided to recommend to the Federal Government to grant exemption to MNFS&R from Rules 5 (in case of G2G) 13, 35, 38 & 40 of Public Procurement Rules, 2004 for procurement of 3.0 MMT wheat through international tender/ or under G2G arrangement, subject to the condition that fair opportunity shall be provided to the potential bidders and to ensure redressal of grievance if any.

Copyright Business Recorder, 2022