FINAL REPORT REGARDING CONSULTANCY FOR CONDUCTING

SUPPLY GAP ANALYSIS CONDUCT OF COST ANALYSIS AND

DETERMINATION OF RETAIL PRICES OF ESSENTIAL ITEMS IN
PUNJAB
PAKISTAN ECONOMY

Pakistan is the world's fifth-most populous country, with a population of almost

242 million, and has the world's second-largest Muslim population. Pakistan
is the 33rd-largest country by area, spanning 881,913 square kilometers
(340,509 square miles). To meet with the Food Security has to depend upon
import.

The total import bill of the country increased to $80.02 billion during fiscal
year 2021/2022 as compared with $58.38 billion in the preceding fiscal year,
according to data released by Pakistan Bureau of Statistics (PBS). The total
import bill inched up by 74.09pc to $12.16bn in July-Aug FY22 as against
$6.98bn over the corresponding months of last year.

Sugar, wheat, palm oil and pulses are the main items procured from
abroad to meet demand at home.

The import bill of all food items posted a growth in value and quantity in
the first two months this year, indicating a shortage in domestic production.
Within the food group import, the major contribution came from wheat, sugar,
edible oil, spices, tea and pulses. Edible oil import witnessed a substantial
increase in quantity, value and per value terms.

Import of palm oil grew by 63.59pc in value in July-Aug FY22 to

$577.022m from $352.729m over the corresponding months of last year. In
quantity, 12.69pc negative growth was recorded in import of palm oil during
the same period. The palm oil import bill increased due to rise in international
price of this commodity.

As a result, the prices of vegetable ghee and cooking oil went up during
the last few months for domestic users. The import of soya bean oil dipped by
42.15pc in value and 67.75pc in quantity during 2MFY22 from a year ago.
 Pakistan imported 57,000 tonnes of wheat in first two months of the
current fiscal year against 39,348 tonnes imported last year, showing an
increase of 44.86pc. Last year in first nine months, the government imported
3.612m tonnes of wheat worth $983.326m as against no imports in the
previous year.

Import of tea and spices grew by 17.24pc and 37.48pc, respectively, in

July-Aug FY22. The growth is mainly due to a drop in import of these products
under transit trade and checks on smuggling in border areas.

The import bill of pulses, dried fruits, milk and other food products
witnessed a massive growth in July.

The machinery import bill increased by 40.96pc to $1.866bn in July-Aug

FY22 against $1.324bn over the same month last year. Import of power
generating machinery went up by 28.18pc in the month under review mainly
due to China-Pakistan Economic Corridor-related projects.

The mobile phones import dipped by 6.66pc in July-Aug FY22 from the
same months a year ago. The decline was noted for the first time in import of
mobile phones as well as its machinery following the introduction of Device
Identification Registration and Blocking System, a system designed to identify
non-compliant devices operating on local mobile networks.

In addition, there are other factors like depleting water reservoirs and
an increase in water losses, which are contributing to changing crop patterns
in the agricultural sector which trigger the threat of food security in the country.
Food security, as defined by the United Nations’ Committee on World Food
Security, means that all people, at all times, have physical, social, and
economic access to sufficient, safe, and nutritious food that meets their food
preferences and dietary needs for an active and healthy life. Pakistan’s
government is trying to balance the equation between the overall challenges
of Climate Change, Food Security, and ever-increasing economic pressures
due to the slow GDP growth rate, which was -0.4 percent for FY 2019-20 while
per capita income decreased from USD $1,625 to $,1325. However, the
projected GDP growth rate of 3.94 percent for FY 2020-21 is under hot
discussion nowadays.

To multiply the aforementioned effects, the ever-increasing annual

population growth rate of 2 percent has unfortunately also augmented poverty
in Pakistan from 4.4 percent to 5.4 percent in FY 2019-20; and has, over time,
spread beyond traditional strata.

According to the Bureau of Statistics (BoS), the imports of food items

during the first 10 months of 2020-21 have crossed $6.9 billion and one of the
top commodities was edible oils including palm oil. Pakistan annually
consumes 4.5m tonnes of edible oil worth more than $3.15 bn. It is the second-
highest expense after the import of petroleum products. Edible oil is the key
ingredient of Pakistani household food consumption, irrespective of which
band the household falls; even the poorest of households derive some part of
their nutrition from using any kind or brand of edible oil including palm oil.
However, the consumer’s awareness regarding health benefits of different
kind of oleins remains low.

Pakistan can only meet 20-30 percent of its edible oil demand from
locally produced oilseeds, the deficit of 70-80 percent is met through imports,
with palm oil/olein making the largest chunk of 34 percent plus share in food
imports, estimated to be 3.3MMT in FY2020-21, ie up by 6 percent from the
preceding year; making it the third largest importer of palm oil/oleins. The use
of palm oil in Pakistan is mostly for food consumption either in the form of
cooking oil or ghee (vanaspati) and both of these are used in the food industry
for frying. Due to consistent increase in population, high oil consumption, and
low/inconsistent domestic production of other oilseeds the import of palm oil
will see steady growth as evident from yearly increasing rate of 4.5 percent
over the last 7-years.

The increasing growing consumption/demand of edible oils needs to be

looked at in more detail, particularly against the backdrop of divergent views
and perceptions tagged to each one of the edible oils including palm oil.
Nowadays the farming of palm oil is being done in a more modern,
sustainable, and environment-friendly manner

Thus, after analyzing the demand, supply, and consumption patterns of

palm oil, it is apparent that Pakistan for a long period will have to rely on the
import of ISPO & MSPO certified Palm Oil from Indonesia & Malaysia. On the
other hand, amid the harvest of fresh palm oil crops in both Indonesia and
Malaysia the supply side has started recovering substantially and the
international prices of palm oil and palm olein are decreasing steadily.
Therefore, Pakistan should look into the possibilities of signing Preferential
Trade Agreements (PTAs) with the countries of export, to reciprocally boost
Pakistan exports against its food items import potential.

Rising food imports could soon become a major contributor to Pakistan’s

future trade deficit. During the 10 months of fiscal year 2020-21, the food
import bill has grown by 54 percent, standing at $7 billion. The importing food
remains the only short-term solution for stabilizing local food prices and
“flooding the local market with imported supplies” so that food prices come
down.

Pakistan is facing increasing inflation trend due to less export and more
import quantum, more over taking loan from IMF and World Bank is also one
of the reason. India export in 2021 was 660.50 Billion US Dollar (Engineering
goods, Petroleum products, Gems and Drugs etc .Whereas, Pakistan
Exported only 34.57 Billion.
 According to USAD economic survey in Pakistan an average house hold
has to spend 45.6% on food items where in USA it is 6.5%, in UK 8.7%, and
in India it is 29 %.
 PRICE CONTROL MECHANISM IN PAKISTAN

Pakistan has a market-based economy where prices are fixed by the

market forces on the principal of demand and supply mechanism. However,
to curb overcharging and hoarding government has established price control
mechanism as under: -

LEGAL FRAME WORK

Following laws/ enactments empowers to control prices and supplies of

essential food items

I. The Price Control and Prevention of Profiteering & Hoarding Act, 1977 &
The Price Control and Prevention of Profiteering & Hoarding Order, 2021
II. The Punjab Essential Article Control Act, 1973 (for non-food items)
III. The Punjab Foodstuffs (Control) Act, 1958
IV. The Punjab Agricultural Produce Markets Ordinance, 1978
V. The Punjab Prevention of Hoarding Act, 2020
VI. The Punjab Agricultural Marketing Regulatory Authority Regulations, 2020
VII. The Prevention of Speculation in Essential Commodities Act 2021

PRICE CONTROL COMMITTEES:

Federal Committees

National Price Monitoring Committee (NPMC) is notified under the

chairmanship of Federal Minister Finance to review supply and price situation
of essential food items at national level. Its meeting is held on weekly basis.
Apart from NPMC, the Honourable Prime Minister of Pakistan also often chair
exclusive review meetings on Price Control with provinces.

Provincial & District Committees

Following committees are monitoring the prices and supplies situation

of essential food items at provincial and district level:
a) District Price Control Committees have been re-notified in all districts in
consultation with public representatives. DPCCs monitor the prices and
supplies situation at district level on monthly and fortnightly basis.
Prices of non-perishable items are notified after DPCC meeting
consulting all stake holders.

b) Forecasting and Supply Chain Committee meetings are being held on

fortnightly basis to foresee the supply of essential commodities in
future.

c) There are 137 Market Committees in Punjab fix the prices of perishable
items for their respective areas.

PRICE FIXATION MECHANISM:

a) After the issuance of Price Control Order 2021 by Ministry of Industries

and Production, Government of Pakistan, Controller General of Prices
for items mentioned in Part-III are Secretary Industries, DG Industries
and all DCs. Price of Poultry Feed at whole sale level has been fixed by
DG Industries and DCs have been directed to issue retail price in their
districts by adding incidentals and retailer’s margin.

b) Fixation of price of Fruits & Vegetable (perishable items): Prices of

perishable items like Tomato, Potato, Onion and other vegetables and
Fruits are fixed through an auction process in the Market Committees.
Auction Process in the market committees are monitored by a
representative of Deputy Commissioner, Market Committee and Local
Rep. Auction process is properly entered in an auction register. On the
basis of auction process wholesale and retail prices of perishable
commodities are notified on daily basis by the concerned Market
Committee.

c) Fixation of Pulses, Meat & other non-perishable items: District Price

Control Committees headed by the concern Deputy Commissioner/
Controller General of Prices & Supplies fix / notify the prices of Pulses,
 Meat & other non-perishable items. Meetings of District Price Control
Committees are being held on fortnightly basis. Prices of pulses are
reviewed in District Price Control Committee meetings by consulting
wholesale grain markets and in consultation with local stake-holder i.e.
traders and consumers.

PRICE CONTROL MEASURES

• Weekly meeting of Price Control Committee Co-Chaired by Minister

Industries and Chief Secretary
• Regular meetings of Provincial Forecasting and Supply Chain
Management Committee held
• Fortnightly Meetings of District Price Control Committees
• Third party validation regarding enforcement of notified prices through
Special Branch of Police and Urban Unit
• Monitoring of movement of Atta and Sugar in border districts
• Daily visits by Commissioners, DCs, ADCs, ACs, & SPMs to monitor
auction proceedings in F&V Mandis
• Regular meetings of DCs with Commission Agents of F&V Markets &
Grain Markets
• Notification of auction timings in Mandis
• Actions against Commission Agents and Pharias (464 Commission
Agents and 1560 Pharias fined)
• Disciplinary actions were taken against 21 officials of Market
Committees
• Kissan Platforms in 105 F&V Mandis and 32 Model Bazars
• Establishment of 200 wholesale points around Mandis
• Sale of Imported Sugar @ Rs. 90/Kg
• Sale of Atta, Sugar & other 54 Vegetable, Fruits and other grocery
items in Sahulat Bazars
• Provision of essential items through DC Counters at mega stores
 • Display of rate boards of standard size at retail outlets along with
contact numbers of relevant officers for registration of complaints
• Daily rate lists of essential items are being displayed in local print,
social & electronic media and at prominent places
• Publicity of “Qeemat App” for awareness of general public
• Price Control Magistrates & their respective areas of jurisdiction
publicized in local newspapers, social media and Cable Networks
along with specially designed Identity Cards for PCMs
SIX MONTHLY PRICES REVIEW OF ESSENTIAL FOOD ITEMS

1. For analysis of prices and supply of essential food Items Data is being
collected by survey from open market, Agriculture, Food, Livestock and
Dairy Development Departments & Other Federal / Provincial / District
level Offices / Agencies
2. Six months prices comparison shows that supply position of essential
food items remained stable except (Ghee, and Onion). Price of three
items (Tomato, Atta and Sugar), reflected downward trend, whereas 10
items (Moong, Mash, Gram, Masoor, Ghee, Eggs, Chicken, Potato, Rice
and Onion) reflected increasing trend.
Sr. Average Retail Price (Rs.)
Items Difference % Change
No. 01.02.2022 31.07.2022
1 TOMATO (KG) 98.0 58.0 -40.0 -40.8
2 WHEAT ATTA BAG 20 KG 1100.0 980.0 -120.0 -10.9
3 SUGAR WHITE (KG) 90.0 85.0 -5.0 -5.6
4 MOONG PULSE (KG) 136.0 144.0 8.0 5.9
5 MASH PULSE (KG) 247.0 285.0 38.0 15.4
6 GRAM PULSE (KG) 137.0 159.0 22.0 16.1
7 EGGS FARMI (DOZEN) 157.0 191.0 34.0 21.7
8 VEGETABLE GHEE (KG) 410.0 510.0 100.0 24.4
9 MASOOR PULSE (KG) 210.0 265.0 55.0 26.2
10 CHICKEN MEAT (KG) 267.0 348.0 81.0 30.3
11 RICE BASMATI (KG) 132.0 177.0 45.0 34.1
12 ONION (KG) 25.0 56.0 31.0 124.0
13 POTATO FRESH 26.0 63.0 37.0 142.3

CPI inflation General, increased by 24.9% on year-on-year basis in July 2022

as compared to an increase of 21.3% in the previous month and 8.4% in July
2021.
On month-on-month basis, it increased by 4.3% in July 2022 as compared
to an increase of 6.3% in the previous month and an increase of 1.3% in July
2021.
2. CPI inflation Urban, increased by 23.6% on year-on-year basis in July
2022 as compared to an increase of 19.8% in the previous month and 8.7%
in July 2021. On month-on-month basis, it increased by 4.5% in July 2022 as
compared to an increase of 6.2% in the previous month and an increase of
1.3% in July 2021.
3. CPI inflation Rural, increased by 26.9% on year-on-year basis in July 2022
as compared to an increase of 23.6% in the previous month and 8.0% in July
2021. On month-on-month basis, it increased by 4.2% in July 2022 as
compared to an increase of 6.6% in the previous month and an increase of
1.4% in July 2021.
4. SPI inflation on YoY increased by 28.2% in July 2022 as compared to an
increase of 21.7% a month earlier and an increase of 16.2% in July 2021. On
MoM basis, it increased by 7.3% in July 2022 as compared to increase of 6.2%
a month earlier and an increase of 1.8% in July 2021. 5. WPI inflation on YoY
basis increased by 38.5% in July 2022 as compared to an increase of 38.9%
a month earlier and an increase of 17.3% in July 2021. WPI inflation on MoM
basis increased by 2.0% in July 2022 as compared to an increase of 8.2% a
month earlier and increase of 2.3% in corresponding month i.e. July 2021.

SUPPLY CHAIN
Sugar: Cost of Production of Sugar for June-22 is available at (Annex-A). Up
till 014-06-2022, 53316,780 tons of sugarcane has been crushed, 5,162,854
tons of sugar has been produced out of which a quantity of 2,224,439 tons
have been sold (43.09%) and 2,938,386 tons of stocks are available with the
sugar mills. Quantity of cane crushed has increased by 33.8% and Sugar
Produced is excess by 36.5% over the last year. During current year
production of sugarcane crop has been increased by 13% over the last year.
During current year, sugarcane crop cultivated on 2,148 thousand acres and
estimated production is 64,203 thousand tons, whereas last year sugarcane
production was 57,000 thousand tons. Likewise, current year estimated yield
of sugarcane has also increased up to 747 monds/acre, which was 742
monds/acre during previous year. The available stocks are sufficient to cater
for the consumption requirements of upcoming month of Ramzan-2022.
No issue is expected regarding supply of sugar during ongoing period. Due to
available sufficient stocks as well as positive indicators regarding current year
area, production and yield of sugarcane crop of Punjab.

Wheat: Cost of Production of wheat for June-2022 is available at (Annex-B)

during current year decrease in acreage of wheat, less availability of fertilizers
and early maturing of crop due to high temperature have caused low yield
which ultimately declined the production of wheat. Wheat crop of Bahawalpur
normally matures and arrives in to market very early and this year maximum
wheat has been procured from Bahawalpur, which otherwise used to dispatch
to other provinces. Moreover, smuggling of wheat was also properly handled
this year, due to which Food Department was able to achieve its procurement
target over and above the last year. This year Food Department procured
4935034 million tons indigenous wheat. Current available stocks of wheat with
Food Department are 4.418 million tons as on 14-06-2022. Wheat releases
are in progress to maintain the flour prices in open market while in normal
condition Food Department releases the procured wheat during the month of
September. Presently 20 kg Atta bag is available @ Rs.980/20 kg.
Due to early release, the procured wheat will be sufficient till March, 2023,
thereafter supply stress may occur and persist till the harvesting of new crop.
He further added that in order to meet expected supply stress Food
Department has requested Pakistan Agricultural Storage & Services
Corporation (PASCO) to provide 01 million ton of indigenous wheat to fulfill
consumption requirement of the province. As international prices of wheat are
abnormally higher especially due to ongoing war between Russia and Ukraine,
therefore at this moment import of wheat will turn out to be very costly.

Pulses situation:
Gram Pulse local production of Gram has been recorded 248,600 tons, which
is 51.5% higher over the last year production i.e. 164,000 tons. This increase
in production is not sufficient as previous year 61.86% of local crop was
damaged, resultantly supply stress and subsequent price hike is prevailing in
the local market. Moreover Russian and Ukraine war has also affected the
supply of Gram in international market as Russia falls amongst biggest
exporters of Gram.
Assessment: Gram prices are expected to remain stable but on higher
side due to less production with reference to consumption requirement.

MOONG Prices are stable and less over the last year due to record production
of 249,770 tons which is 29.73% higher over the last year.
Moong price will remain stable on lower side. Whereas, imported pulses Mash
& Masoor are expected to be on higher side due to bulk buying by India from
international market and gradual surge in dollar conversion rate.

Masoor are above 90% imported from other countries to fulfill domestic
consumption requirements. Mash is mainly imported from Myanmar and
Masoor from Canada, this year good production of both crops has been
reported. However, India has waved off import duty on import of Masoor and
reduced quota restrictions on import of Mash for bulk buying of both pulses,
which resultantly caused stress supply in international market and surge in
international prices of both pulses. Dollar conversion rate further fuel up the
prices of these pulses in local market. It was informed that as harvesting of
Gram crop has been done recently so prices were likely to come on lower side
but they remained on higher side, which seems to be as result of hoarding in
Gram producing areas.

MASH is mainly imported from Myanmar and this year good production of
mash crop has been reported.
Potato: This year estimated production of potato is 7.7 million tons which is
36% higher over the last year. Therefore, due to bulk availability of fresh potato
from Punjab, prices of potato are on very lower side as compared to last year.
Current wholesale price of fresh potato is ranging between Rs.29 to 34/Kg
which is 16% less over the last year. It is expected that on account of sufficient
availability of local fresh potato, its supply and price situation will remain
normal.

Assessment: Supply and price situation of potato will remain stable in near

future.
Onion is mainly arriving from Punjab and some from Sindh in local wholesale
markets. An abnormal surge in prices of onion is being observed due to stress
supply in local wholesale markets. Estimated cropped area of onion was
recorded 67,700 acres which is 34 % less over the last year and estimated
production was recorded 367,000 tons which is 37% less over the last year.
Low return to the onion farmer during last year is a basic cause behind the
substantial decline in acreage. Due to stress in supply the price of onion is on
higher side. Current average wholesale price of onion is ranging between Rs.
56 to 61 / kg in local wholesale markets which is 263 % higher over the last
year. After Mid-June-2022 local crop of onion will be near to end and supply
from KPK (10% share in domestic production) and Baluchistan (29% share in
domestic production) will start to arrive in local markets but to stabilize the
prices of onion, import from neighboring countries will be required. In this
regard, Agriculture Department already approached the M/o National Food
Security and Research to consider the import of onion from the neighboring
countries to stabilize the prices of onion in the local market.

Assessment: Supply and price of local crop of onion is expected to remain

under stress up to July-2022 due to significant decrease in cropped area as
well as production over the last year in Punjab province. Local supply of onion
will not be sufficient to fulfill consumption requirement of the country and will
remain instable till the arrival of onion from KPK & Baluchistan and import from
neighboring countries.
 Tomato: Local production season of tomato in Punjab province is on full
swing due to which tomato prices are stable in local wholesale markets.
However, abrupt increase in temperature is very damaging for standing crop
of tomato. Moreover, area under tomato crop has declined from 19,400 acres
to 16,000 acres, showing 17.5% decrease over last year. Likewise, production
of tomato has also declined from 147,300 tons to 121,300 tons, showing
17.7% decrease over the last year. Due to less cropped area decrease in
production prices of tomato are on higher side as compared to last year.
Average wholesale price of tomato is ranging between Rs.41 to 47/Kg, which
is 214% higher over the last year. In this regard, Agriculture Department
already approached the M/o National Food Security and Research to consider
the import of tomato from the neighboring countries to stabilize the prices of
onion in the local market.

Assessment: Supply of tomato is expected to remain stable and price will also
remain stable.

Poultry Items:
Prices of Grand Grand Parent flocks are raised in foreign countries, Pakistan
imports Grand Parent flocks through different companies, through which 50
companies are engaged to raise broiler within 42 days. At present flocks
rearing of poultry birds is sufficient. He further informed that during month of
May, supply and prices of poultry products usually remains on higher side in
every year due to old grains and pollution caused by wheat harvesting, low
humidity, diseases and low growth rate. Now a day demand of chicken meat
is also on higher side due to frequent marriage events. On account of given
factors mortality and weight loss occurs in poultry bird which resultantly
disturbs the supply and increases prices of poultry products. He further added
that within 15 days supply and prices of poultry products will remain stable.
Industries and Production Division Islamabad has issued Price control order
dated 24-08-2021, under The Price Control and Prevention of Profiteering and
Hoarding Act 1977. Poultry Feed is included in schedule of items which fall
under the purview of the price control and prevention of Profiteering &
Hoarding Act, 1977 and order made thereunder on 24.08.2021 Several writ
petitions are pending in the Lahore High court Lahore to fix prices of poultry
Feed and poultry items. Whereby the Honorable court has directed to chalk
out mechanism for fixation of prices of Poultry Feed under the prevailing
enactments being controller General of Prices under the law. Secretary
Industries and DG Industries are Controller General of prices in this case.
Series of meeting with the stakeholders of poultry industries have been held
to finalize a price formula to decide a MRP for poultry Feed. Rate will be
notified on the recommendation of technical committee notified in L&DD
department.

Assessment: Prices of poultry products are expected to remain on higher side

due to low quality feed, low humidity, disease attacks and low growth rate.
Cooking oil: Cost of Production of Ghee for June-22 is available at (Annex-
H) International prices of Palm oil have decreased down to $ 1740/ton due to
lifting of ban on export of palm oil by Indonesia on 23-05-2022. Indonesia is a
largest producer and exporter of palm oil in international market. The declining
trend in international prices will also reflect in local prices of cooking oil/ghee
with passage of time. Pakistan Vanaspati Manufacturing Association (PVMA)
is keeping sufficient stocks, due to which local supply and prices of cooking oil
are expected to be stable subject to stability in international prices of palm oil.

Assessment: It is expected that local prices of cooking oil /ghee will remain
stable due to left of ban on export of palm oil by Indonesia and sufficient
availability of stocks with Pakistan Vanaspati Manufacturing Association
(PVMA). It is expected that prices of cooking oil/ghee will decline in the local
market as a result of decline in international prices of palm oil and better supply
situation in the international market subject to stability of Dollar Rupee
conversion rate.

Markets and basis of whole sale and retail prices of essential items
including all overheads expenditure

In Punjab to facilitate farming and regulate the systematic growth and

transformation of the marketing of Agricultural produce and to assist the
development of agricultural commerce through multiple channels; to provide
meaningful support to the growers; and, to make for incidental provisions,
PAMRA (Punjab Agriculture Marketing Regulatory Authority) Authority Act
2018 has been promulgated.

About 131 Market Committees have been established under PAMRA and 196
Markets, under the private sector, have been registered 115 Dedicated
Farmer Platforms (105 in F&V Markets and 10 in Model Bazars) 226
Wholesale Fruit & Vegetable points near F&V Markets.
All over Punjab 292 Sahulat Bazars have been facilitated with F&V
Stalls. 317 AFP Shops are established all over Punjab during Ramzan.
Moreover, there are 10 Major wholesale Grain Markets at Divisional Head
Quarters, from where grains and other essential food items are provided at
whole sale rates.

BASIS OF PRICES
All prices are fixed on principle of demand supply basis and fair auctions.
Nonperishable items rates are daily fixed by open auction in market
committees and a rate list is issued with the signature of secretary market
committees. Whereas prices of nonperishable items are fixed and notified by
Deputy Commissioners after meetings of District Price Control Committees.
Whole sale prices are fixed on the average of highest and lowest average
auction rates. Retail rates are fixed by adding 5-6% margin for non-perishable
and 10-15 % margin for perishable items.

Local Demand of Commodities and Supply Chain Mechanism

Essential Food Items /district wise demand situation is mentioned below.
Supply mechanism is based upon farmers, Arhatis, Pharias, Wholesalers and
retailers. No government agency is involved to maintain supply chain
management of essential food items.

Role of Arhatis

There are two primary sources of agricultural credit: informal and formal.
Informal sources usually include commission agents (also called Arhaties),
input suppliers, village shopkeepers, friends, and relatives. Among these,
Arhaties play the most dominant role and have a significant share in informal
credit disbursement.

Registered Arhaties have long-term relationships with many farmers. In some

cases, both Arhaties and farmers invite each other into family gatherings and
marriages, indicating that the relationship extends beyond professional to
personal lives.

Services offered by Arhaties are not uniform but instead depend on the type
of market, its structure, and farmer’s demand. Arhati provides two significant
services to the farmer. First, he gives cash/inputs on credit at the time of
sowing of a particular crop, and second, he acts as the sale agent for the
farmer to dispose of his produce.

The poor financial situation of the farmer, long distances from organized
markets, and lack of understanding of post-harvest crop management
practices are among many factors that play a vital role in ‘farmers’ decision-
making process whether to sell the produce at the farm gate or bring it to the
Mandi to sell it through the Arhati. Selling at the farm gate is preferred by many
farmers due to the shortage of labor, high cost of transportation, and high
commission expenses. All products that enter the Mandi are immediately
auctioned to avoid the risk of price fluctuation, and payments are made the
same day to the farmer.

Arhati provides credit or inputs to meet the liquidity gap that farmers face. The
timely provision of credit allows farmers to purchase necessary inputs and
machinery for farm operations. Agricultural credit is considered one of the
strategic resources of crops and plays a vital role in improving agricultural
productivity. This implies that Arhati indirectly contributes to improving farm
productivity. Higher productivity raises the standard of living among rural
communities. Hence, Arhati plays a significant role in the process of rural
development.

In some cases interest rates charged by the Arhati show that he makes money
by lending to small and medium farmers. But despite the high interest charged
by the Arhati, it is essential to investigate the reasons that force farmers to
secure credit from non-formal over formal resources.

Why do farmers prefer informal over formal credit sources?

Formal credit sources (Government and private banks) have low-interest

rates, but excessive procedural requirements delay credit release. Delays in
supplying inputs to crops make credit less productive and increase ‘farmers’
risk.

Moreover, the demand for collateral by formal credit institutions is difficult to

fulfill because of an inefficient system of land transfers in Pakistan. Due to
problems in the inheritance process, a large part of agricultural land is still in
the name of forefathers or grandparents and thus collectively managed by
families. Since families are not legal persons but financial institutions are
reluctant to lend against collateral not owned by the borrower alone; this limits
farmers’ choice to avail of agriculture credit facilities from formal institutions.

On the other hand, farmers are also opposed to mortgaging their land as
collateral, given that it is their only significant asset in many cases. Farmers
must place their passbooks (ownership documents for agricultural holding) as
collateral with the bank when they borrow. In case of failure in returning the
borrowed credit, banks pledge ‘farmers’ entire holding.

If Arhati faces any problem in recovering the lending amount from a farmer
due to crop failure or any personal circumstances faced by the farmer at the
time of repayment (such as the illness of a family member or marriage of a
daughter etc.) Arhati does not let the farmer force-close due to non-payment.
Under such circumstances, the Arhati recovers what the farmer can afford to
repay, reschedule the outstanding amount, and extends a new loan to allow
the farmer to plant his next crop. This implies that Arhati rolls over the loan
and reflects a flexible attitude to get his money back. Our discussion with
farmers from different areas of Pakistan shows that it is an opposite model
compared to the formal credit institutions. In the case of formal credit, if the
farmer defaults, there is no other option except for the mortgage of land to
face foreclosure. Even though, in some cases, a loan taken from the formal
institution is only a small percentage of the total value of the collateralized
asset. It might be because of strict policies introduced by the state bank of
Pakistan implemented by commercial banks. However, in any case, it needs
to be re-visit. Any flexibility from the formal institutes to reschedule the credit
reimbursement could help to win the ‘farmer’s trust. This may help to increase
the share of formal credit in the total credit market.

Arhaties are more flexible and ready to work on a risk-sharing basis (crop
failure, sickness in the ‘farmer’s family, and unforeseen events) which would
otherwise place the farmer at a massive disadvantage in dealing with the
lender. But still, as a common practice, arti ‘doesn’t demand any signature
from farmers on any legal document (except Arhati unilaterally noting it down
for his record) while also no collateral is required either. In addition, no
questions are asked regarding the purpose or utilization of the borrowed
amount or the schedule for the release of funds to match with crop production
stages. But in return, the farmer must bring his produce for auctioning at the
‘lender’s shop and pay a commission on the value fetched. In case of failure,

The farmer is accountable for paying interest in proportion to the shortfall that
the farmer was supposed to bring for auction. However, in case of any disaster
that leads to crop failure, the farmer is allowed to extend the repayment period
of debt to enable him to plant the next crop and repay the combined
outstanding loan amount upon harvest. Under these circumstances, the
farmer is liable to pay interest only on the unpaid loan.

However, the reality is not so worse. Without any doubt, Arhati charges four
to five times the rate of interest than the formal institutions, but he also
provides a service that the formal credit sector does not.

Essential Food Items /district wise demand situation is mentioned below.

PER CAPITA MONTHLY PER CAPITA ANNUAL CONSUMPTION (000

Sr.
Commodity CONSUMPTION (KG) TONS) YEAR 2019-20
No.
PUNJAB PAKISTAN PUNJAB PAKISTAN
1 Gram 0.15 1.80 201.257 380.106
2 Mash 0.04 0.48 53.669 101.362
3 Masoor 0.06 0.72 80.503 152.042
4 Moong 0.07 0.84 93.920 177.383
5 Tomato 0.49 5.88 657.440 1241.680
6 Onion 0.92 11.04 1234.378 2331.317
7 Potato 1.20 14.40 1610.058 3040.848
8 Apple 0.25 3.00 335.429 633.510
9 Banana 4.02 (No.) 48.24 - -
10 Dates - - - -
11 Rice 0.99 11.88 1328.298 2508.700
12 Wheat 7.26 87.12 9740.850 18397.130
13 Sugarcane - - - -
14 Sugar 1.36 16.320 1824.732 3446.294
15 Chilli 69.46/Gram 0.83 93.196 176.014
16 Garlic - - - -
17 Ginger - - - -
18 Mango - - - -
19 Citrus 2.42 29.04 3246.950 6132.377

Population; Pakistan=211.170 million

Punjab=111.810 million
Source: Agriculture Statistics of Pakistan 2017-18, Ministry of National Food
Security and Research Islamabad, Agriculture Fruits, Vegetables &
Condiments statistics of Pakistan, CRS Punjab and PBS
*=Pakistan Production up to July 2019 to March2020)
For detail of production and consumption report for the month of May (Annex
J-R) may kindly be consulted
 DISTRICT WISE STORAGE FACILITIES IN PRIVATE SECTOR
Total Total
Total No. Total No.
Storage Storage
District of Cold District of Cold
Capacity Capacity
Storages Storages
(Tons) (Tons)
Lahore 58 81856 Faisalabad 41 124630
Sheikhupura 14 16178 Jhang 4 5200
Nankana - - T.T. Singh 25 68110
Kasur 50 4615 Chiniot 10 30500
Gujranwala 23 30800 Multan 23 155670
Hafizabad 5 2250 Khanewal 51 118100
M.B. Din 16 15000 Vehari 34 104950
Gujrat 9 1569 Lodhran 7 1380
Sialkot 35 119540 Sahiwal 140 466823
Narowal 8 2155 Pakpattan 69 457756
Rawalpindi 9 23400 Okara 134 524465
Attock 4 6755 Bahawalpur 29 36590
Chakwal 7 1400 Bahawalnagar 5 1880
Jhelum 11 230 R.Y. Khan 9 20135
Sargodha 17 35055 D.G. Khan 8 25000
Khushab 3 1380 Rajanpur - -
Bhakkar 1 100 Layyah 5 6850
Mianwali - - Muzaffargarh 7 21000
Punjab Total: 871 2511322

The cold storage prevents the spoilage of perishable commodities like Potato,
Apple & Kinno, etc. and making them available off-season and in places where
they are harvested. This also serves the dual purposes: the growers of the
perishable produce don’t need to sell out their produce in hurry at throwaway
price and protect the nation from shortage of commodities due to spoilage of
food during off season.
The storage of fruits and vegetables for preserving their edible characteristic
and freshness for a longer period of time has become an integral part of fresh
fruits and vegetables market supply chain systems. Therefore, setting up of
cold store on commercial basis is quite lucrative business option for potential
investors.

DISTRICT WISE STORAGE CAPACITY OF PUBLIC SECTOR

In the last six years, Pakistan Agriculture and Storage Corporation (PASSCO) and
provincial Food departments have spent billions of rupees on revamping their
existing grain storage facilities or expanding them, officials claim.

In Punjab some steel silos have been installed under an IFC supported public-
private partnership programme, but a similar project in Sindh is believed to have
run into snags. Punjab’s combined storage capacity is in excess of 100,000
tonnes. Both, the Punjab Board of Investment and Trade (PBIT) and the Sindh
Board of Investment have been lobbying for attracting investment in silos
construction.

Officials hope to see enough investment coming in once such silos are
constructed, the storage facility could be rented out to Passco and Punjab food
department.

The authorities in Sindh and Punjab are also interested in building storage
complexes in wheat and rice growing areas. “Since such complexes comprising
storage facilities plus auxiliary equipment for drying of crops and loading them
on transport vehicles are very expensive, there is need to plan to engage local and
foreign funds and companies.

According to a SBP report, there is a huge gap between the public sector’s total
storage capacity and its actual need for grains and fruits and vegetables.

Gaps in storage requirements and available facilities offer huge business

opportunities for companies interested in this sector.

From ready-to-install small steels silos to silo-bags there are many ways of
expanding storage infrastructure, Silo bags are specially designed hermetic bags
that can store up to 60 tonnes of grains under such conditions that prevent
infestation by squeezing oxygen levels.

Some big landlords in Sindh and Punjab have started importing Chinese silo bags
with prices ranging between $1000-10,000 per set depending upon their quality,
storage capacity and the material used in manufacturing. Scarcity of grain storage
facilities has also given rise to godown and warehouse-renting, industry sources
say, adding that storage rents in Sindh has increased by 30-40pc in past four
years.
DISTRICT WISE STORAGE CAPACITY OF PUBLIC SECTOR

CAPACITY
DISTRICT CAPACITY (Tons) DISTRICT
(Tons)
Multan 89300 Chakwal 6500
Lodhran 77500 Gujranwala 88500
Sahiwal 89500 Sialkot 34500
Pakpattan 104580 Gujrat 26100
Vehari 115000 Bahawalpur 107000
Khanewal 127900 Bahawalnagar 104800
Faisalabad 206000 R.Y. Khan 137900
T. T. Singh 72800 Lahore-I 61000
Jhang 152800 Lahore-II 28625
Sargodha 100405 Sheikhupura 105500
Khushab 18405 Kasur 47100
Mianwali 14000 Okara 98100
Bhakkar 25200 D.G. Khan 9450
Rawalpindi 134795 Rajanpur 8180
Attock 16000 Muzaffargarh 60370
Jehlum 14500 Layyah 42140
Punjab Total: 2324450
STOCK POSITION OF AGRI. STORED ITEMS IN THE PUNJAB

Sr.
No. District Potato Apple Banana Dates Ginger Gram Mash Masoor Moong Rice

1 Lahore 22936 8654 4707 1830 170 316 126 190 144 2362
2 Sheikhupura 1580 18 145 - - 134 24 35 21 15108
3 Nankan Sahib - - - - - 30 5 12 8 2668
4 Kasur 92680 - 6311 - - 82 45 46 38 4003
5 Gujranwala 593 738 815 - - 52 26 24 15 71233
6 Hafizabad 150 - 55 - - 43 18 16 15 57
7 M.B. Din 8385 - 249 - - 17 7 15 7 36593
8 Gujrat - - 347 - - 79 32 60 56 2196
9 Sialkot 9755 1166 313 - - 394 116 115 89 27395
10 Narowal - - 320 - - 91 22 22 16 5071
11 Rawalpindi - 3280 220 1950 - 284 121 109 135 1527
12 Attock 116 61 - 10 - 5 7 4 8 32
13 Chakwal 390 118 345 125 - 43 53 31 38 701
14 Jhelum 8800 - 142 - - 12 15 14 16 140
15 Sargodha - 530 352 350 - 2825 2 553 592 3035
16 Bhakkar - 105 62 - - 292 46 56 290 119
17 Khushab - 15 203 - - 58 37 65 43 1661
18 Mianwali - - - - - 65 35 48 57 34
19 Faisalabad 14230 7406 870 2654 - 5546 1151 2298 1859 15652
20 Jhang 2982 408 1050 27 - 171 27 33 25 7584
21 Chiniot 22600 - - - - 11 5 8 5 3268
22 T.T. Singh 19200 50 132 120 - 47 37 37 32 1534
23 Multan 52750 7468 408 3555 - 1632 338 488 478 7460
24 Khanewal 17440 - - - - 123 26 35 108 3023
25 Vehari 50535 - 2500 - - 72 2 1 27 11785
26 Lodhran - - 70 - - 15 9 10 12 11535
27 Sahiwal 408467 21 160 5 - 51 39 35 37 343
28 Pakpattan 238618 450 72 - - 38 8 11 23 793
29 Okara 120800 - 378 - - 69 35 39 32 31044
30 Bahawalpur 6661 502 19 159 13 76 28 24 43 545
31 R.Y. Khan 3727 1915 156 18 100.3 146 38 81 115 4600
32 Bahawalnagar - - 81 - - 71 30 36 56 519
33 D.G. Khan 1250 3405 56 50 - 26 13 13 10 1500
34 Layyah 7950 - 8 40 - 278 9 15 11 1397
35 Muzaffargarh - - - - - 56 28 32 37 199
36 Rajanpur - - - - - 11 5 5 6 35
Total 1112593 36308 20545 10893 283 13260 2566 4616 4503 276748
Importable / Exportable Items

Tomato:
Production season of Tomato in Sindh (Badin, Karachi, Tando Allahyar,
Larkana, Thatta & Kashmore) is about to end. However, local production
season of tomato in Punjab is on peak due to which tomato price has started
to show decreasing trend in local wholesale markets. As Local supply of
tomato will improve gradually, prices of tomato will decrease accordingly.
Average wholesale price of tomato is ranging between Rs.39 to 44/[Link]
arrival in the local markets was recorded 183 trucks per day out of which 129
trucks are from Punjab, 55 trucks from [Link] domestic production is
8,18,700 tons, consumption requirement 11,53,430 tons and import 2,40,368
tons.
Tomato price has started to show decreasing trend due to availability of local
crop in bulk quantity. As local supply of tomato from Punjab will improve, prices
of tomato will decline accordingly.
Onion:
Onion is mainly arriving from Sindh and some from Punjab in local wholesale
markets.
Reportedly, onion crop of Sindh has come under virus attack, due to which the
supply of onion from Sindh has drastically declined from 242 to 188 trucks per
day within last two weeks.
Production season of Onion in Punjab is at initial stage due to which limited
supply is available, Punjab has 25% share in onion crop.
During Current Year 2021-22, Acreage under Onion crop has been decreased
from 103,000 acres to 68,000 acres, which is showing 34% decrease over the
last year. Estimated production of Onion is 367,000 Tons showing decrease
up to 37%.
Short supply due to virus attack and decrease in acreage are the basic
reasons behind recent surge in price.
Price of onion is ranging between Rs.59 to 64/Kg.
Total arrival in the local markets was recorded 272 trucks per day out of which
156 trucks from Sindh, 106 trucks from Punjab and 10 trucks from Balochistan.
During 2020-21, Production of onion in Punjab is 0.588 million tons, which is
34.6% higher over the last year 2019-20.
Pakistan exports its onion to Malaysia, Sri Lanka, UAE, Bangladesh, Qatar,
Oman & Singapore. During 2020-21, 385,279 tons of onion has been
exported, while last year onion was exported 315,778 tons.
Price of Onion is on higher side due to decrease in supply from Sindh as result
of virus attacks as well as reduced area & production of local crop of Punjab.
Onion season of Sindh is about to end and season of Punjab has just started.
As supply of onion from Punjab will increase gradually, stress will reduce
accordingly.

Potato:
Bulk supply of fresh potato of Punjab is arriving in local wholesale markets due
to which prices are lying on lower side.
Price of fresh potato is stable which is ranging between Rs.23 to 27/Kg, which
is 40% less over the last year.
Total arrival in the local markets was recorded 466 trucks per day from Punjab.
During year 2021-22, expected production of Potato crop is 7,346,000 tons
which has been increased by 29.3% over the last year (5,682,000 Tons) as
per report of CRS Punjab.
Pakistan mostly export its potato to Afghanistan, Sri Lanka, Russia, UAE,
Qatar, Malaysia & Oman etc. During 2020-21, 395,284 tons of potato has
been exported, while last year potato was exported 364,791 tons.
Price of fresh potato is stable over the days and less over the last year due to
availability of Punjab crop in sufficient quantity.
Gram:
As per CRS Punjab report, during current year 2021-22 production of gram is
expected to be 2,48,600 tons, which is 51.5% higher over last year production
which was 1,64,000 tons.
Harvesting of local Gram crop has almost been done and due to better crop
prices are expected to remain on lower side. Decrease in price of Gram will
also cause decrease in prices of other pulses due to substitute effect.
Price is ranging between Rs. 132 to 136/Kg.
Current International Price of Gram is US$ 610/tons.
Pakistan is importing Gram from Australia, Russia, Canada, USA, Turkey,
Afghanistan & Ethiopia.
During 2020-21, Pakistan imported 53,228 tons of Gram, which was 29,837
tons in the previous year 2019-20.
Total Domestic Production is 233,900 tons, Consumption requirement
287,128 tons and Import 53,228 tons.
Price of Gram is stable but on higher side due to high international price and
appreciation of dollar rate. As local supply of Gram will increase gradually,
prices will decline accordingly.
Mash:
Price of Mash whole in local wholesale markets is ranging between Rs. 213-
220/Kg.
Current International Price of Mash is US$ 930-970/tons.
Mash is entirely imported from other countries, mostly from Myanmar.
Myanmar is main supplier of Mash in the world.
Pakistan imports Mash from Montenegro, Singapore, Thailand, Afghanistan,
Malaysia & Russia
During 2020-21, Pakistan imported 66,083 tons of Mash, which was 64,081
tons in the previous year 2019-20.
Price of Mash is stable over the days and less over the last year in the local
market due to decrease in its international price. However, importers are
undertaking careful & limited import.
Masoor:
Current local price is ranging between Rs. 194 to 200/Kg. Price of Masoor is
stable over the days and higher over the year. Current International Price of
Masoor is US$ 900/tons.
Masoor is mostly imported from Canada and Australia.
During 2020-21, Pakistan imported 173,211 tons of Masoor, which was
171,922 tons in the previous year 2019-20.
Due to insufficient domestic production, almost 95% domestic consumption
requirement is met through import.
Price of Masoor is showing slightly increasing trend over the last year in the
local market due to less production of masoor in Canada (main producing
country in masoor production), bulk purchase by India and increase in
international price & dollar rate. Importers are undertaking careful & limited
import. It is expected that in coming days price may increase further.
Moong:
Current average wholesale price of Moong is ranging between Rs. 110-114/Kg
which is 33% less over the last year.
Local production is sufficient to meet local demand of the province. During
year 2020-21, expected production of moong crop is 249,770 tons which has
been increased by 29.73% over the last year as per report of CRS Punjab.
In case of less local production, sometime Moong has to be imported. Pakistan
mostly imports Moong from Afghanistan, Brazil, Kenya, Argentina & Tanzania.
During 2020-21, Pakistan imported 51,560 tons of Moong, which was 31,499
tons in the previous year 2019-20.
Domestic prod. is 2,04,500 tons, consumption requirement 2,56,060 tons
Price of Moong is stable over the days and less over the last year due to higher
production over last year.
Ghee/Cooking Oil

As per PVMA about 130 manufactures of vegetable ghee, cooking oil and
allied products catering for the national consumption. The Industry
manufactures 4.5 million M. Tons and installed capacity is 7.0 million M. Tons.
According to the United States Department of Agriculture’s (USDA) estimates,
the per capita consumption of cooking oil in Pakistan is 24 kg. The imported
palm oil in Pakistan is being used for making a range of goods like Vanaspati
Ghee, chocolates, soap and various bakery items.
Approximately 5.7 million M. Ton of Ghee / Cooking Oil is manufactured and
consumed on annual basis in Pakistan. The Punjab consumption is 2.9 million
M. Ton. The main raw material used is RBD Palm Oil (90%) for manufacturing
of Ghee / Cooking Oil. Annually 3.1 million M. Ton Palm Oil is imported from
Malaysia. In addition, 0.2 million M. Ton Soya bean Oil is imported from USA
and other countries
Sugar
I. Per Capita per year consumption = 25 Kg
II. Domestic and Commercial consumption pattern =30:70
For total population of Punjab Province =2,922,561 M. Ton
There are 41 sugar mills in the Punjab province and average annual
production of sugar is around 3.5 M.M. Ton to 3.7 M.M. Ton The production
of sugar in the Punjab province also caters the demand of other provinces
like KPK and AJK.
Crushing Season 2019-20 2020-21 2021-22
3.05 .M. Ton
Total Production 3.75 M.M. Ton 0.058 M.M. Ton
0.45 .M. Ton
Last Year Stock 0.04 M.M. Ton 0.019 M.M. Ton
1.51 .M. Ton
Total Stock 3.79 M.M. Ton 0.077 M.M. Ton
0.2-0.3 M.M. Ton
Estimated Shortfal 0.2-0.3 M.M. Ton 0.3-0.4M.M. Ton
Import 0.104 M.M Ton 0.150 M. M. Ton ----

Importable / Exportable LIST IMPORTERS/ EXPORTERS

list of importers and exporters are available at ( F/A)
 Import / Transportation Modes

Transport and logistics are an important part of the economy in their own right,
contributing to GDP and jobs. The transport sector contributes more than 13%
of GDP and 5.4% of total jobs to Pakistan’s economy. This highlights the
importance of the freight and logistics sector to Pakistan’s economy Punjab
has a skewed modal transportation mix, with approx. 94% of freight moved by
road.

ROADWAYS
Road transport is one of the most expensive mode of transport, elevates the
supply chain cost for the whole economy. The national highways and
motorways carry the majority of all freight, and in particular the N5. Under
CPEC and CAREC, significant investments have been made to the national
highways and motorways, with an expanded and enhanced network across
the country.

An efficient transportation system plays a vital role in the economic

development of a country. The government vision for economic growth and
poverty reduction requires massive investment and development of
infrastructure for sustainable economic growth. Pakistan Railways has a
definite edge over roads for long haul and mass scale traffic movement both
for passengers and freight in addition to providing a safe, economical, and
environment friendly mode of transport. Throughout world history, rail traffic
has played an important part in the development and economic prosperity of
nations. Railways are a valuable source of employment while generating large
Pakistan Railways has lost its competitiveness to road transport, and the rail
infrastructure is in poor condition nor is the organization adequately geared
towards. Recently, Pakistan Railways has been able to prioritize freight and
therefore regain some freight.

RAILWAYS
An effective railway system facilitates commerce and trade, reduces
transportation costs (monetary and non-monetary), and promotes rural
development and national integration while reducing the burden on
commuters. Pakistan Railways was the primary mode of transportation in the
country till the seventies. However, owing primarily to a diversion of already
scarce resources towards the expansion of the road network, the performance
and condition of Pakistan Railway declined and its share of inland traffic
reduced from 41 percent to 10 percent for passenger and 73 percent to 4
percent for freight traffic.
Inland waterways are not yet utilized, despite the existence of the Indus River
and attempts from Attock to Daud Khel.

AIRWAYS
Pakistan International Airlines (PIA) The year 2007 turned out to be an
exceptionally difficult year for PIA. The Airline experienced a series of
financial, operational and marketing problems during the past year that
severely hampered its performance. In the early part of the year, an operating
restriction was placed on PIA flights by the European Union. Apart from
providing a negative image for the Corporation, this translated to a loss in
market share as well as growth in business which made the situation
exceptionally difficult. An unprecedented increase in oil prices adversely
impacted PIA’s bottom line and neutralized recovery efforts. Attempts were
made to contain the impact of a rising fuel bill by reducing the utilization of
older and fuel inefficient planes. The airline was also mired by increases in
pay to certain categories of personnel and a depreciation of the Rupee against
the Dollar. Ever increasing competition and entry of new operators in certain
key markets reduced the level of traffic for PIA. Yields were increased despite
the added competition but revenues remained static for the year.
Air freight is very limited, with all domestic airlines prioritizing passengers over
freight. The multimodal transport infrastructure is almost non-existent giving
rise to overreliance on road transport.
This modal imbalance is overburdening road systems, causing congestion,
creating pollution and damaging roads, all contributing towards high cost of
transportation.

SEA PORTS
A) Karachi Port Trust (KPT). The steady and continuous progress made by
KPT has helped boost the national economy over the years with international
trade ever-increasing in a globalized world.
Karachi Port and Port Qasim are the international gateways. These two ports
together export and import over 95% of all freight of the country. Recent
expansions and developments have seen significant improvements in
reduced dwell times, from 11 days to less than 6 days. However, still
improvements are required due to delay in clearance from customs.
Connectivity to and from the Karachi Port is a point of concern due to the
congestion currently witnessed and the lack of a functioning rail connectivity.
B) Port Qasim Port Qasim is the first industrial and commercial port of Pakistan
operating under landlord concept. Today it caters for around 40% of shipping
requirements of the national economy. During the last financial year 2006-07,
PQA handled a record volume of 24.3 million tonnes cargo showing an
impressive growth of around 13% over corresponding period. However, from
July to March of the current financial year, 2007-08, PQA handled 19.76
million tonnes of cargo depicting a growth rate of 10% over the same period
last year. Cargo volume also surpassed the budget targets by 3% during the
same period under review. There has been a vast improvement in cargo.

C) Gwadar Port Gwadar, a district of Balochistan enjoys a strategic position

on the coastline with immense trade potential for not only Pakistan, but also
for the region in general. The purpose of developing a port at Gwadar is to
stimulate economic growth in the western and northern parts of Pakistan,
utilizing the available coastline resources of the country and also providing
and outlet for land-locked Central Asian Countries and Afghanistan through
transit trade and offering trans-shipment facilities. With a fully equipped and
well-functioning port at Gwadar, Pakistan will be able to promote trade and
transport with Gulf States, China, Europe, Africa and Central Asian Countries;
unlock the development potential of hinterland; divert the influx of human
resources from upcountry to Gwadar instead of Karachi; provide a
socioeconomic uplift of Gwadar, the province of Balochistan and the country
in general; establish shipping related industries; reduce the congestion and
dependency on existing ports; and serve as a regional hub for major trade and
commercial activities.
Gwadar Port has the potential of becoming a transshipment port but is still
very much under development.

INTRA AND INTER PROVINCIAL TRANSPORTATION ISSUES

Pakistan is a consumption-oriented country and approximately 78% of GDP

comprises of household consumptions. Over the years there is considerable
improvement in the availability of food items in Pakistan. However, due to high
population growth (2.4% per annum), the food shortages and an increase in
their prices is a repeated phenomenon. It makes food insecurity a consistent
challenge for Pakistan due to not adopting modern practices in the agriculture
sector and a high population growth rate. It is also worth mentioning here that
undernourishment results in poor health of the human resource, resultant in
productivity decline at an individual level, which at the aggregate level hurts
GDP growth. Furthermore, because of the rapid urbanization and
globalization, Pakistani society is experiencing socio-economic
transformation. Horizontal growth of cities has not only decreased agriculture
land but also increased transportation cost of commodities.

The logistics sector is highly fragmented and is in dire need of

modernizations. The largest road freight transporters control less than 2
percent of the total market share and almost 85% of the companies
involved in the logistics and road freight sector are owner-operator
companies. In general, these owner-drivers are poorly trained, lack
insurance for the drivers and their cargo, with vehicles based on
obsolete technology that are not in compliance with the certification
requirements for vehicles under international agreements and are
incapable of meeting the performance demands of a modern supply
chain. Most operators lack the financial capacity to modernize their
trucks. Furthermore, because the fleet is obsolete, it creates perverse
incentives for perpetual overloading of trucks that damages the road
network, leading to extra expenditures for road maintenance and a poor-
quality road network. Efforts to enforce the axle load regime, resulted in
resistance from either the operators or industry and deferment. The most
recent attempt in 2019 was received positively by many operators,
however was criticized by the industry due to its’ sudden
implementation, absence of a transition period and the potential
increase in logistics costs. Pakistan has a skewed modal transportation
mix, with approx. 94% of freight moved by road. Road transport is one
of the most expensive mode of transport, elevates the supply chain cost
for the whole economy. The national highways and motorways carry the
majority of all freight, and in particular the N5. Under CPEC and CAREC,
significant investments have been made to the national highways and
motorways, with an expanded and enhanced network across the
country. Pakistan Railways has lost its competitiveness to road
transport, and the rail infrastructure is in poor condition nor is the
organization adequately geared towards. Recently, Pakistan Railways
has been able to prioritize freight and therefore regain some freight.
Inland waterways are not yet utilized, despite the existence of the Indus
River and attempts from Attock to Daud Khel. Air freight is very limited,
with all domestic airlines prioritizing passengers over freight. The
multimodal transport infrastructure is almost non-existent giving rise to
overreliance on road transport. This modal imbalance is overburdening
road systems, causing congestion, creating pollution and damaging
roads, all contributing towards high cost of transportation. Karachi Port
 and Port Qasim are the international gateways. These two ports together
export and import.
DOCUMENT THE COMMODITY FLOW ROUTES, CRITICAL
MARKETS
Subject matter has already been analyzed in import and export of commodities
above.
The transportation is the shifting of goods by truck, rail, road, and sea and is
reasoned as an important indicator for economic development. Transport has
two main parts. The first part represents vehicles that are either van, truck,
rails, airplanes, or ships and second part represents the transport
infrastructure such as roads, highways, seaways, airways, and railway tracks
on which transport runs smoothly.
In the recent days, both parts of transportation are considered as an important
factor of trade and help in reducing transportation cost and travel time. The
selection of transport mode for delivery of goods within less time and minimum
cost is important to maximize the profit.
Every state tries its best to discover short trade routes that can reduce trade
cost and transfer time. To enhance their trade, countries invest in transport
infrastructures like roads and rails and adequate transport infrastructure can
potentially reduce transport cost and travel time. Transport cost and travel time
are considered as the most important among all factors.
Shipping industry plays a significant part in the development of trade and
about 80% of world trade is transported by the international shipping industry.
The import and export of goods on large scale are not possible without
shipping.
The geographic location of Pakistan is very important and has attracted many
world powers for economic, political, and energy interests [2]. Pakistan has a
border with China in the Northwest, Afghanistan in the West, India in the East,
Iran in the Southwest, and the Arabian Sea in the South. It is the gateway of
Central Asia and the Middle East and plays a vital role in transport economy.
Pakistan also serves as a transit route to noncoastal courtiers, Central Asian
states, and Afghanistan to trade by providing smooth access to the worldwide
market by the Arabian Sea.

CONCLUSION.
 The government is responsible to provide the basic necessities of
life to the people at a fair and reasonable price and is under legal duty of frame
a fair policy regarding production and supply of different commodities in the
market. This is essential to control the black marketing and hoarding etc. to
maintain the prices at reasonable level and government without permitting
monopoly must ensure free competition so that the prices may not be out of
the reach of a common person. Be that as it may, since the control of prices
depends on the production and supply of different items in the market,
therefore, it may not merely an administrative matter to be dealt with through
the machinery of law rather there are many other factors which play vital role
to control the prices in the market and these factors are not in the exclusive
control of government, therefore, the use of machinery of law to control the
prices in the market without increase in production to keep balance in demand
and supply, would be of no significance.

NAVEED ASHRAF
CONSULTANT SPU
 DETAIL OF IMPORTERS OF TOMATO, CAPSICUM LEMON
AND OTHER VEGETABLES FROM INDIA
[Link] NAME OF COMMODITY SHOP NO. MOBILE NO.
IMPORTERS IMPORTER
1 Mr. Shafique Tomato & Lemon Shop No.58 Vegetable 0302-8465066
Bhatti Market
2 Mr. Rana Tomato Shop No. 30 Vegetable 0300-4743503
Faheem Market Ravi Link Road
Lahore
3 Mr. Muhammad Tomato, Lemon, Shop No. 23 Vegetable 0323-4747747
Usman Capsicum &Cucumber Market Ravi Link Road
Lahore
4 Mr. Haji Shabeer Tomato, Lemon, Shop No. 11Vegetable 0300-9463542
Capsicum &Cucumber Market Ravi Link Road
Lahore
5 Mr. Haji Zafraan Tomato & Lemon Shop No. 15 Vegetable 0333-4244041
Market Ravi Link Road
Lahore
6 [Link] Shoaib Tomato , Lemon & Shop No. 56 Vegetable 0300-4030507
Capsicum Market Ravi Link Road
Lahore
 LIST OF IMPORTER & EXPORTERS
[Link] Name Contact No. Exporter / Address
Importer
1 Akhtar Butt 0300-4332275 Exporter Out Side Vegetable Market
Ravi Link Road Lahore
2 Raheem Traders 0302-4225502 Exporter Out Side Vegetable Market
Ravi Link Road Lahore
3 Javed & Co 0300-4024211 Exporter Out Side Vegetable Market
Ravi Link Road Lahore
4 Haji Sabir Hussain 0321-4541008 Exporter Vegetable Market Ravi Link
Road Lahore
5 Habib Khalil 0300-8473410 Importer 10-Vegetable Market Ravi
Link Road Lahore
6 Javed Bhatti 0300-4008421 Importer 3-Vegetable Market Ravi
Link Road Lahore
7 Usman 0323-4747747 Importer 23-Vegetable Market Ravi
Link Road Lahore
8 Shabir Nazeer 0300-9463542 Importer 11-Vegetable Market Ravi
Link Road Lahore
9 Umar & Co 0321-3332333 Importer 54-Vegetable Market Ravi
Link Road Lahore

LIST OF IMPORTER EXPORTER (FRUIT)

S. No. Name of Importer Exporter Market Phone
1. Maraj Din, Muhammad Ramzan & Fruit Market 0300-4007282
Company
LIST OF IMPORTERS OF PULSES
Importer’s address City Contact No.
Rana Tayyab Faisalabad 0300-8663940
(Zain Impex) Commission Agent / Importer Pulses
Mr. Younas Jamal Commission Agent/Importer Pulses -do- 0321-6602640
Mian Asif Aslam -do- 0300-8665970
President Anjuman-e-Arhtian New Grain Market
Rana Intazar, Hassan International -do- 0300-8669388

Muhammad Farman, Hamza Traders -do- 0300-9652956

Haji Fiaz Waraich, Factory Owner , Pulse Importer Trader Sargodha 0300-3513535
0343-3513535
Muhammad Iqbal Factory Owner, pulse importer -do- 0300-9604573

Muhammad Kashif Factory Owner , Pulse importer -do- 0321-6017327

Muhammad Ashar Factory Owner -do- 0300-9600196
Rana Fawad Factory Owner , Pulse Importer -do- 0300-9602618
Rafiullah Factory Owner , Pulse importer -do- 0322-7003322
1
 LIST OF IMPORTERS OF APPLE & DATES
Apple
Importer’s address City Contact No.
051-4430093
Farhad Enterprises, Importers/Commission Agent F&V Market Islamabad Islamabad
0313-7676870
Abdul Wahab & Co.
-do- 0344-5876757
F&V Market Islamabad
Ch. Sagheer F&V Market Islamabad -do- 0322-5555107
Ali Sadqain Fruit Company
Lahore 0316-4004735
Syed Tariq Abbas
Zulfiqar Ali Bashir Ahmed C. Agent -do- 0300-8440149
Haji Ramzan & Company -do- 0300-8491900

Dates
Naveed Ahmed & Co. Lahore 0300-4693057
Alhafiz Brothers, C. Agent -do- 0301-4371576
Asim Fruit Merchant -do- 0322-4867075
Mian Asif Aslam Faisalabad 0300-8665970
President Anjuman-e-Arhtian New Grain Market
Al-Fareed Traders,
Rawalpindi 0300-5347734
Haji Naveed Ganj Mandi Rawalpindi
Abdul Ghafoor Qadri,
Rawalpindi 0335-8436946
Ganj Mandi Rawalpindi
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