ISLAMABAD: The Senate Committee on Commerce has asked the Trading Corporation of Pakistan (TCP) — a state-owned company mainly responsible for exporting and importing commodities — to submit a categorical assurance that no imports would be made outside its mandate.

A committee meeting, presided over by Senator Zeeshan Khanzada on Thursday, recommended introducing the bifurcation of procurement plan into regular and emergency situations so that commodities could be imported at minimal rates.

Briefing the committee, the TCP chairman said the private sector imports of the commodities normally made by the TCP were not banned, but due to the exemption of taxes and heavy government subsidy available to the TCP, the private sector did not import these commodities.

He informed the committee that the TCP procured goods for food security and industries for urea and it mainly imported wheat, sugar and urea to respond to emergency situations.

The TCP chairman presented proposals to the committee for permanent exemption on limitations on splitting tenders, 30 days’ response time, 15 days’ hosting time before approval for inviting objections, matching bids, limitation on negotiations and 15 pc repeat per cap.

The committee was also briefed on the functioning of the TCP with a focus on its role in the post-flood scenario.

The TCP chairman said that the corporation was fully owned by the government and was financially independent, as it did not receive any budgetary grant from the federal government. Besides, the government determined when the TCP should import different commodities, he said. He informed the committee that the TCP invested 80 per cent of its funds in government securities (treasury bills and investment bonds), whereas 20 per cent of the funds were invested in term deposits and “daily products”.

About the role of National Fertiliser Marketing Limited, the committee was informed that the state-owned enterprise was a distributive network and did not procure goods. The TCP chairman informed the committee that as per the audit report of 2021-22, the TCP generated Rs2365.99 million in profit after taxation, and as per the audit of 2020-21, it paid Rs200m in dividends to the government.

He also told the committee that TCP’s income and expense stood at around Rs4.469 billion and Rs1.046bn, respectively, for the 2021-22 year.

Besides, the TCP’s commodity procurement was financed through cash credit limits from commercial banks and until funds were collected from the recipient of goods, the markup kept on accruing on bank borrowings.

Published in Dawn, November 18th, 2022