LAHORE – After failing to convince the millers, Punjab Chief Minister Mian Shahbaz Sharif has sought prompt intervention of Prime Minister Yousuf Raza Gilani to resolve confrontation between the millers and his government over sugar price dispute.
Well-informed sources disclosed to TheNation on Sunday night that the Chief Minister contacted the Prime Minister by phone and requested him to pull him out of the quagmire.
The millers during a meeting with Punjab cabinet committee here on early Sunday demanded to take the Prime Minister on board to resolve the issue. Sources believed that the Punjab government had decided to review its strict policy against the sugar millers, as the consequences of closure of mills during the upcoming sugarcane crushing season would be dangerous.
“The government has realised that the situation will go out of control if the millers close down the mills or delay sugarcane crushing during the next season, taking place after two months,” a provincial minister told this reporter requesting anonymity. “The sale of sugar at Rs 40 per kilogram is not an issue. The issue is the upcoming crushing season,” he added.
“Who will come to our rescue if the millers close down sugar mills and the growers take to streets across the Punjab? We will not be able to afford that situation,” he argued. He said that the financial loss would be beyond expectations in case even if the millers delayed the crushing. “Punjab produces sugarcane worth over Rs 50 billion every year. If the millers delayed the crushing season even for one month, the estimated loss will be above Rs 20 billion,” he maintained.
“The millers demanded of the committee to take the Prime Minister on board as it is a federal subject, otherwise they will not initiate any dialogue with the Punjab government,” sources privy to the development said.
The committee headed by Senior Advisor Sardar Zulfiqar Ali Khan Khosa comprising Senior Minister Raja Riaz Ahmad, Food Minister Malik Nadeem Kamran, Finance Minister Tanvir Ashraf Kaira met the members of Pakistan Sugar Mills Association (PSMA) to resolve the price dispute issue. However, the fifth member of the cabinet committee Law Minister Rana Sanaullah was absent from the meeting due to some personal engagement, sources added.
According to the insiders, the cabinet committee agreed to the mill ownersÂ’ demand that Punjab government would present documents in favour of the millers before the court if the court summoned the government in that regard. However, the government would not file any review petition before the court.
The government has agreed to clarify the actual position before the court if the court sought report from the provincial government,” insiders said. In return the millers agreed to release the un-lifted and sold sugar stocks of 225,000 tonnes stashed at the mills godowns.
During the back-channel dialogue, the Punjab government refused to withdraw police force and officials of revenue department deployed at the sugar mills across Punjab, while the millers also straightforwardly declined to sell sugar at Rs 36 per kilogram ex-mill price. However, the millers on the demand of the committee also assured that they would restore the sugar supply to the market at Rs 45 per kilogram ex-mill price.
Sources in the Punjab government believed if the Lahore High Court verdict implemented, it would trigger sugar smuggling to other provinces due to considerable price difference and lead to shortage of the commodity in the open. They further said that Punjab government would have to give Rs 2.25 billion subsidy on 225,000 tonnes of sugar stocks available with them if it was sold in the open market at Rs 40 per kilogram, according to the orders of the court.
“The government is not in a position to provide such a huge subsidy,” a high-ranking official said, adding the government had decided to approach the court to seek guidance in that regard. These sugar stocks were purchased at Rs 45 per kilogram ex-mill price and the deals were done before the LHC’s verdict, he maintained.
On Saturday, the PSMA straightforwardly refused to sell the commodity at Rs 36 per kilogram and threatened if the government attempted to use coercive measures and arrest the mill owners as a lost resort, they would close down the mills for the next crushing season.
The millers said that although they respected the LHCÂ’s verdict, yet it was based on incorrect statistics given by the government and was passed without giving millers adequate opportunity to put across their point of view.
The millers will file a review appeal before the court as soon as courtÂ’s signed ruling is received, according to Chairman PSMA Kayani.
The Punjab Chief Minister on the same day presided over an emergent meeting of provincial cabinet at Chief Minister Secretariat and directed to constitute a five-member committee to hold negotiations with the sugar mill owners and dealers.
The LHC had ordered the Punjab government to ensure the sale of sugar at Rs 36 per kilogram ex-mill price and Rs 40 per kilogram retail price and take punitive action against the violators.