New wheat support price expected today

* Increase in Rabi crop ‘incentive package’ also expected
ISLAMABAD: Special meeting of the Economic Coordination Committee of the Cabinet is expected to approve today (Friday) wheat support price for wheat crop 2010 at over Rs 1000 per 40 kg – and increase in Rabi crop incentive package from Rs 2400 per acre to over Rs 6000 per acre, official sources informed on Thursday.

Federal Minister for Finance Dr Hafeez Shaikh will chair the special ECC meeting with a two-point agenda.

The agriculture ministry – keeping in view the cost of production of wheat that has increased by about 8.7 percent to Rs 850 currently from Rs 782 last year as assessed by the Agriculture Policy Institute (API) – had suggested ECC to raise wheat support price by Rs 50/40 kg. With increase in Rs 50, the wheat support price was suggested to be fixed as Rs 1000/40 kg against the last year Rs 950/40 kg. The API also suggested the government fix the public sector wheat procurement target for 2010-11 at 6.5 million tonnes.

ECC in its last meeting had constituted a committee comprising Minister for Agriculture, Petroleum, Deputy Chairman Planning Commission and Governor SBP to report in a week time on the wheat support price and public sector wheat procurement.

The special meeting of the ECC is expected to consider the recommendations of the ECC Sub-Committee and is expected to approve new support price of wheat that is expected to be over Rs 1000 per 40 kg, the sources added.

The ECC is also expected to fix the wheat procurement target keeping in view the proposal forwarded by Agriculture ministry based on the recommendations of the Agriculture Policy Institute (API). It’s worth mentioning here that during the last ECC meeting, it had approved a grant of Rs 2400 per acre for the farmers having less than 12.5 acres of land to give impetus to Rabi crop sowing in the flood affected areas. It was agreed that provinces and federal government would equally share the grant money, which was estimated to remain between Rs 5 billion to Rs 7 billion. The government will arrange this grant money from its own resources.

The review of this year’s federal and provincial budgets is underway for re-appropriation. The government cannot delay as the Rabi sowing season has arrived. This incentive alone will inject more than Rs 80 billion in the rural economy after the Rabi crops are harvested in April-May period next year, he said.

By Sajid Chaudhry [DailyTimes]

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