The wheat scandal has put the present government in a difficult position. The story is simple. Every year the government announces a minimum purchase price for wheat and procures the commodity after it is harvested at the officially announced rate. This year, too, the government fixed the minimum wheat price at Rs3900 per 40kg but is not purchasing wheat from the growers in sufficient quantities.

As a result, the farmers have been forced to sell their produce to middlemen who are not offering more than Rs3000 per maund. This has created a crisis situation for small farmers who depend on the sale of wheat to meet their other expenses. In the aftermath of this crisis, the activists of Pakistan KissanIttehad (PKI) and KissanIttehad have launched a social media campaign, urging farmers not to sell their crops at low prices and to hold onto their produce for the time being. Last week, the farmers also held protest rallies in Lahore and several other cities.

The government’s excuse is that since it holds sufficient wheat stock, it cannot buy wheat from farmers in the quantities they offer. But this is not as simple as it sounds. The situation has much to do with the government’s faulty procurement policy. Punjab procures over 4 million tonnesof wheat every season to meet its yearly requirements. But this year the authorities decided to slash the procurement target by half, leaving the farmers in the lurch. Another problem is that the provincial food department failed to announce any firm procurement schedule or targets for wheat purchase from the open market

The elephant in the room is the carryover stock of over 3m tonnes of wheat which was imported by the caretaker government without taking into account the wheat stock in hand and the upcoming bumper crop a few months ahead. Another mistake made by the food authorities in Punjab was that they changed the procedure for applying to sell wheat to the food department. Unlike in the past when the growers were required to submit written applications to procure gunny bags used to pack and transport wheat to procurement centres, the government launched a mobile application for the purpose, without taking into account the fact that a majority of the rural population is not well-versed in the use of information technology. According to a report, over 400,000 growers applied for gunny bags; but the government said it would issue six bags per acre and only to those who owned up to six acres of land. Besides, the procurement campaign has also been unusually delayed this year, crashing the local wheat market with middlemen exploiting the situation by buying wheat from the growers at much less than the officially fixed minimum support price of Rs3,900 per 40kg.

The current wheat glut crisis has its origin in the recent import of 3.4 million metric tons of wheat by the caretaker set-up as well as the incumbent government. Given a surplus of wheat in the country, there was no need for the import deal which led to a staggering loss of over Rs300 billion to the national exchequer. According to a report, the last caretaker government imported 2.8m tonnes of wheat for Rs250bn and during the present regime 700,000 tonnes of wheat worth Rs80 billion reached the country. Thus, $1.1bn flew out of Pakistan for the import of the commodity. The government’s decision to import wheat despite a domestic surplus has led to allegations of corruption and mala fide intentions on the part of those behind the deal.

No wonder, the opposition and farming communities have slammed the government for its alleged involvement in what they term a “wheat scam” and demanding an immediate inquiry into the matter. The crisis has dealt a severe financial blow to Pakistan’s farming community and also undermined the credibility of the government in the public eye.

An inquiry committee has been set up to investigate the issue and fix responsibility. The government’s reputation is at stake and it is widely being said that as in the past the scam will be brushed under the carpet so as to shield the guilty. This impression can be dispelled if the government acts promptly to address the concerns of the farming community and bring to account those who caused the wheat mess.

Meanwhile, the government is trying to appease the farming community by announcing that it is considering a Rs130 billion package and also planning to give a subsidy between Rs400 and Rs600 per 40kg instead of increasing the procurement target. But in the opinion of KissanIttehad leader Khalid Batth, the government would use this policy as a ploy to relieve pressure from the farming community for the time being.