LAHORE - The rates of rice have jumped by over 30 per cent in the period of just one week, as the non-conventional traders have jumped into the business and started hoarding rice, creating artificial scarcity of commodity.

The prices of super basmati have gone up Rs 4,000 per 40 kgs from Rs 3,400 while rates of PK 386 (Irri) have jumped to Rs 2,300 from Rs 1,800 per 40 kgs.

“The non-traders’ aim of minting money by piling stocks of rice will ultimately lead to food inflation in the country, observed vice chairman of the REAP Chaudhry Samee Ullah.

He expressed his concern over the criminal negligence of Punjab government, which has failed to crack down on the hoarders. “It is the responsibility of the Punjab government to control price-hike and take strict action against the profiteers and hoarders.

He said that the financial institutions are also supporting them with huge banking limits. He warned the financial institutions that such artificial price-hike would curb exports blatantly. He asked the State Bank of Pakistan to take serious steps against those banks, which are offering limits to such hoarders in the country. It’s the role of central bank to ensure that all financial limits be utilised against the assigned purpose only. Chaudhry Samee warned the banks that current prices may cause losses to non-traders elements, putting depositor’s money on stake.

Besides causing inflation in the country, the artificial hike in prices of rice has also knocked the exporters out of the international market due to ineffective pricing against neighboring country of India, he stated.

He said that the rice export orders have registered an exponential decline of 60 per cent than last year.

“We need to keep regional parity intact. The Indian basmati is cheaper than our super basmati. We managed to extract $100 per metric ton premium for our basmati but the difference in pricing has reached to ever high levels of $250 per metric ton which is indigestible by most of the global buyers.”

He said that Pakistan produces 6 million tons of rice while local consumption is just 2 million tons. Rest of the 4 million tons rice can be exported if its rates remain at the level of international market due to artificial hike by the profiteers.

“India, being much cheaper source, has the advantage to substitute our international brand against their cheaper quality basmati, but we are struggling to keep our orders intact. The Pakistani rice exporters have managed to place orders of 200 containers of Indian high quality rice which is due to arrive at Karachi Port within next 3 weeks. The rice will be cheaper than our produced basmati by $200 metric ton.”

“Reap and its members have donated $20 million to national exchequers in the form of direct taxes on exports. Having contributed such a significant amount to national tax net and earning much needed foreign exchange for the beloved country, it is believed government would take steps to safeguard the interests of the rice exporters,” the vice chairman added.