ISLAMABAD, Jan 27: The ministry of food has suggested to the Federal Food Committee (FFC) to increase the official flour price at Utility Stores and in the open market by a minimum of Rs4 per kg if it wants to discourage smuggling of flour to neighbouring countries and stabilise prices at home.

Insiders told Dawn that at a recent briefing to the FFC, the Ministry of Food, Agriculture and Livestock (Minfal) recommended an increase in price at the Utility Stores from Rs13 to Rs17 and in the open market from Rs16 to Rs20.

The ministry suggested a similar raise in the price of wheat being supplied to mills from government godowns.

Sources said the FFC was considering the suggestion as an option after finding it difficult to bring down the number of consumers queuing outside Utility Stores to buy flour and continuing high prices in various parts of the country – Rs20-25 per kg in some areas of Sindh and the NWFP.

They said the ministry told the FFC that the move would help bring down the open market price of flour in parts of Sindh, including Karachi, the NWFP and Balochistan and would reduce the number of people thronging the Utility Stores.

The ministry informed the FFC that the deployment of Frontier Constabulary (FC) along the Pakistan-Afghan border at Chaman in Balochistan and Torkhum in the NWFP had failed to check the smuggling of flour to the neighbouring country.

Flour is still being transported to Afghanistan on hundreds of mules.

A senior Minfal official told Dawn that the ministry had told the FFC that it had proof that Pakistani flour was also being smuggled to Iran and India.

In India, the flour is selling at Rs24 at government-owned stores, while prices hovered around Rs34per kg in the Indian open market. He said a single flour bag of 20kg gave a profit of Rs250 to a Pakistani smuggler or simply a labourer if he managed to take it to India at any point of the border.He said Minfal had informed the FFC that it still believed that prices could not come down at least before March when the new wheat crop would be ready for harvest.

He said the increase in supplies was a means and not a total solution to the ongoing crisis.

He said that people had been paying more than double the official price over the past two months and the situation would continue for another three months.

The final figure of the extra payment made by consumers this season for buying flour would run into billions of rupees, the official said.

“This crisis is worse than that of the sugar we witnessed last year,” he observed.

Consumers in the NWFP and Balochistan suffered immensely as this year an estimated 2.5million tons of flour would cross over to Afghanistan compared to less than a million tons in normal conditions.

The Minfal official said some groups were involved in the systematic purchase of cheap flour at the Utility Stores and reselling it in the open market or supplying it to hotels.

It said that at many places labourers had stopped going to work and instead they were buying flour bags at Utility Stores and reselling it in the open market because of the high profit margin. Even garbage collectors in major cities including Islamabad, Rawalpindi, Karachi, Lahore and Peshawar are buying flour from the Utility Stores and reselling it in the open market.

The government has not yet fixed the wheat procurement rate for the new crop and would buy it on market rates. This season, the government plans to procure seven million tons of wheat from farmers compared to five million tons last year to maintain reserves.