THE agriculture sector has suffered from prolonged official indecision about the way the agricultural trade should go. Whether it should be governed by free trade laws or by providing a human face to free market mechanism?

Neither the previous parliament debated and decided about the rules to be applied to trade nor has the current one so far taken up the challenge. In the absence of a public debate on the issue, no one can really discern what the official priorities or policies are.

The latest debate on allowing export of maize underscores the point. The stakeholders in maize trade are now blaming each other and are citing different economic models to substantiate their claims and counter-claims. The feed millers and poultry associations see an unfair lobbying behind the decision. So do farmers, but from opposite perspective.

The Pakistan Poultry Association is launched an advertisement campaign against the export of maize. It maintains that even countries like Brazil, Argentine and India (with much bigger agricultural base) have banned export of cereals because of rising world prices.

Pakistan, it claims, is already deficient in maize, which is the major staple food in NWFP and Balochistan, and a supplementary food in the other two provinces. Its export would put further pressure on wheat demand. Shortage of maize was felt in SAARC countries after India banned its export and Pakistan jumped in without realising about its own future needs.

The export would push domestic prices further up affecting the poultry industry badly. Maize forms 60 per cent of the raw materials of the poultry feed industry. Any increase in feed price would directly reflect in poultry rates.

The officials of poultry industry think that a group of mercantilists, who benefit both from import and export, are behind the decision. They make money on export and then on import. Citing the case of wheat export and import, they say that history would be repeated within a year. The country exported wheat last year at $210 per ton and later imported it at the rate of $650 per ton. Currently, maize is being exported at $300 per ton and it is believed that it would be imported at double the price later.

The farmers, however, paint an different picture. They resent efforts to get ban on maize export. Accusing the feed and poultry industry for hurting agriculture by making an effort to ban its export, they say that there is no shortage of the grain. Rather, there was a bumper crop of four million tons, out of which the industry would use only three million tons – leaving an exportable surplus of one million tons.

The maize prices fell on arrival of new crop, which has started picking, irritating the industry into demanding ban on export.

Both sides quote “official figures” to justify their claims, which, interestingly, contradict each other. No one knows the truth behind these claims, largely because they are unaware of the context or the rationale of the policy.

Had this decision been taken in the parliament after a thorough debate, it should have been considered from all points of view and the decision would have been justified. But that has not been the case. The industry and farmers are fighting it out on the media, while, the export goes on.

The industry hides behind the current increase of international prices of cereals and pleads for ban to “save the poor” from rising maize prices in the domestic market. The farmers on the other hand, for once, cite rules of free market and repeat the refrain of many ministers:

“let the import and export of the same commodity go on simultaneously and the size of economy grow.” Interestingly, on other occasions and at different platforms, the farmers also plead for subsidy on inputs prices, defeating their free market logic.

Currently, the entire trade of agriculture sector is divided between “free market economy and protectionism,” with no one knowing which policy to apply on which commodity. At one time, the farmers would be pleading for subsidies, that is against free market principles. Yet another time, they plead for free international trade and world prices for their commodities--- where ever it suits them.

The latest example of such confusion is the wheat price; they want subsidy on DAP fertiliser but want the government to get out of price-fixing and let wheat be sold at international price even in domestic markets.

The industry is also doing the same thing. It wants subsidies on power bills but want to sell its products at international prices, even in domestic market.

The Fauji Fertiliser Company (FFC) produces DAP locally but sells at international price. The government itself produces entire natural gas from local resources but has linked its price to world prices of the British Thermal Unit (BTU).

The traders, farmers and all other stakeholders of agriculture trade hide behind different theoretical perspectives at different times, depending on what suits them at that particular point of time.

One can understand the traders and farmers differing on different economic propositions to maximise their profits, but official policies should set the right direction.

A perception is that some ministers decide these matters under the influence of different cartels. Such attitude only encourages cartelisation of agriculture trade, as has happened in other sectors like cement, sugar and most recently the CNG stations.

Such sensitive issues should be dealt with all seriousness and should require approval of the parliament, if food security is to be achieved and manufacturing has to be fed with adequate raw materials.