ISLAMABAD - While showing satisfaction over the decline in inflation rate, the National Price Monitoring Committee (NPMC) on Monday directed to work out modalities to maintain strategic reserves of sugar and wheat to ensure smooth supply at affordable prices during the upcoming financial year. 

Finance Minister Shaukat Tarin, chairing the NPMC meeting, directed to initiate international procurement drive of wheat and sugar through public, private and government to government arrangements. The government will import up to 4 million metric tons of wheat from July 2021 onwards to build a strategic reserve of wheat. Similarly, the Finance Minister directed that Ministry of Industries and Production in consultation with Ministry of Commerce and provincial governments to present a precise estimate for importing sugar before the next NPMC. 

The NPMC reviewed the price trend of essential commodities especially wheat flour, chicken, eggs, sugar, pulses and edible oil during the week under review. 

While briefing the NPMC about the weekly SPI, the Secretary Finance Division apprised that there has been a continuous decline in the weekly SPI over the period of last two consecutive weeks which is a positive sign indicating ease in inflationary pressures. 

NPMC reviews price trend of essential commodities 

The weekly SPI decreased to 0.61% on 3rd June 2021 and 0.63% during the preceding week. The consolidated and coordinated efforts of the Federal as well as respective Provincial Governments and departments concerned have yielded consistent results.  The Committee was further briefed that declining trend in food inflation is being witnessed in the midst of tremendous price hike in international commodity prices during the ongoing COVID-19 pandemic particularly the third wave. 

The Finance Minister was briefed that as per international commodities’ prices comparison published by the World Bank the international price of sugar has increased by 58.3% (year-on-year) and escalated to 5.6% during the last month (April 2021-May 2021). Similarly, the international price of Soyabean oil increased to whopping 119.20% in Year-on-Year comparison whereas increased by 23.5% during the last month (April-May 2021).  

The COVID-19 crisis has played havoc with international supply chain scenario and fuelled food inflation all over the globe.

Furthermore, the international price trend in Palm oil indicated an increase of 102.6% (Year-on-Year) and 7.9% during the last month. 

Going by the aforesaid international trend, the domestic price hike couldn’t be avoided as Pakistan is the net importer of staple food commodities like wheat, sugar, edible oil, pulses etc. During these testing times, the government has taken all possible measures to provide maximum relief to the masses during pandemic-induced global food inflation crisis. 

While reviewing the situation, the Finance Minister stated that inflation and COVID-19 have been the two main concerns for global markets particularly during the second quarter of 2021. The ongoing pandemic has forced the global economy into a state of complete/partial lockdowns and with the wider dissemination of vaccines, the situation is likely to improve and will eventually ease the inflationary pressures towards the end of the year worldwide. There is a need to take into account a holistic picture vis-vis price hike at international and regional levels, he added. 

While taking stock of the daily releases of wheat by the respective provincial governments, the Finance Minister strictly directed the provincial governments to continue daily release of subsidized wheat and ensure its availability to general public at affordable prices throughout the country in compliance with the directives of the Prime Minister. 

While reviewing the prices of poultry, a significant decline in the national average of chicken prices is seen which is around 16% and could be attributed to the strict administrative measures taken by the respective Provincial administrations. The Finance Minister lauded the corrective measures taken and reiterated the firm commitment of the government to ensure smooth supply of poultry at fair prices for the consumers. No anti-competitive practices will be tolerated, he affirmed.