LAHORE, Dec 11: For the second time in three days, the Punjab government has increased the release price of wheat by Rs5 per 40kg — from Rs335 to 340.

Under the cascading policy, the food department has increased the wheat price thrice during the last two months. It started releasing wheat on Oct 10 at the rate of Rs330 per 40kg, which was Rs10 higher than the release price last year. The second revision, which was due on Dec 1, was effected on Wednesday with an increase of Rs5 per 40kg. Instead of notifying that increase, the government on Thursday increased the price by another Rs5 per 40kg. The decision was implemented the same day, triggering fears of further increase in the flour price which was already higher than ever before.

The Pakistan Flour Mills Association (PFMA) has called an emergency meeting on Saturday to consider the ramifications of government’s decision.

The food department however claimed that it would not let the millers increase the flour price further because they had already been given a liberal latitude in fixing the price. On Wednesday, they increased the ex-mill rate of a 20kg bag of flour by Rs5. It was Rs2.50 more per 20kg than the increase in wheat price, which was Rs5 per 40kg. Now, the millers would be made to sell flour on the previously fixed price of Rs308 per 20kg.

The department has been forced to increase the price of wheat to keep it in the province, said an official of the department. It is faced with a situation where availability has become more important than price. Wheat in other provinces is being sold at an abnormally high price. Keeping the price down in the Punjab would naturally work as an incentive for hoarders to take it to other provinces and create a shortage in the Punjab.

But millers think that the government is making money at the cost of the common man. “It purchased this wheat at a rate of Rs300 per 40kg and after four months, it was now selling it for Rs340,” said an official of the PFMA. It was extracting a profit of Rs40 per 40kg, but it expected millers to sacrifice their profits in its favour. The government is doing so in a year when it got funds for procuring wheat at a mere 2.5 per cent, thus saving over Rs2 billion. Another billion rupees were saved by passing the transportation cost to millers.

A visibly irritated buyer said 20kg flour was being sold for Rs170 to 175 last year. During the last 12 months, the government had increased the price by Rs50 per 20kg. The flour price in the market had already touched Rs215 per 20kg and would be going up by another Rs10 once the latest increase took effect. How on earth a government could squeeze the common man like this and still claim to be democratic, he remarked, adding that this would push another few million people down the poverty line and create social chaos.

“The Punjab government is headed by a flour miller who is truly aware of the situation in the sector,” said another buyer. If he is unable to control the price or is politically insensitive to the social and political cost of flour price increase, God save the common man, he said.