Wheat transport cartel: ECC orders investigation

[LRE]

ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has ordered investigation against the formation of cartel by the private transport agencies authorised to transport imported wheat from Karachi to other cities of the country, official sources told daily Times on Friday.

ECC in its last meeting with Prime Minister Syed Yusuf Raza Gilani, constituted a committee in the chairmanship of the Federal Minister for Food and Agriculture with secretaries from ministries of commerce and communication as its members to investigate the cartel in private transport sector. The committee has been asked to present findings of investigation with proposed measures for improvement in transportation of wheat before the ECC in its next meeting.

The services of many transport agencies were used for the transportation of 1.76 million tonnes of imported wheat from Karachi to main cities of all three provinces Punjab, NWFP and Balochistan.

This was a huge transportation task, which was completed with the help of private transport agencies using trucks and trailers. Official sources further informed that the private transport agencies which have been authorised to transport wheat from Karachi to other provincial capitals and other cities have allegedly formed a cartel and are charging exorbitant transport charges from the provincial food departments.

This behavior of the transport agencies has not only caused loss to the governments by making additional payments in the head of transport charges to the said agencies but also increased the cost of imported wheat for the recipient provinces. ECC in its direction has tasked the said committee to thoroughly investigate the bottlenecks in the transportation of wheat purchased by Trading Corporation of Pakistan (TCP) from Karachi to up country.

According to another official, ECC in its next meeting after examining the findings of the investigation might refer these findings of investigation of the said committee to the Competition Commission of Pakistan (CCP).

CCP is fully authorised to investigate and hold enquiry and arrange hearing of any alleged cartel formed in any sector of the economy under the competition policy and law. CCP has full authority not only to investigate but also to punish with exemplary fine up to Rs 50 million each to the companies involved in cartel.

Out of this total import of 2.5 million tonnes of wheat in phases, TCP has already finalised purchase of 1.7 million tonnes of wheat so far. Total import of 2.5 million tonnes would be completed by 31 December 2008. The government has already started the process of acquiring about 0.75 million tonnes wheat in international market. Out of 2.5 million tonnes of wheat, 1.7 million tonnes has already been imported out of which nearly 1.4 million tonnes is already been dispatched to required areas.

The Government of Pakistan and the Government of USA have signed an agreement for provision of 50,000 M.T of US soft white wheat to Pakistan on 17 December 2008. Apart from this the government has plans in its hands to import 1 million tons additional wheat to bring strategic reserves at a comfortable level.

The action by the government against transport agencies would help to bring the transportation charges to a reasonable level and this would also help swift transportation of additional over 1 million tonnes of wheat to be imported during 2009.

daily times