Business Recorder
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has reportedly deferred approval of Rs31.56 billion in financing for wheat procurement for 2025-26, including the operationalisation plan, until May 2026, subject to further refinement of the proposal, sources told Business Recorder . The Ministry of National Food Security and Research (MoNFS&R) briefed the ECC in its recent meeting that wheat is cultivated over an average area of 22 million acres, with annual production ranging between 28 and 30 million metric tons. It was informed that in compliance with the Federal Cabinet decision of November 19, 2025, the Interim National Wheat Policy (INWP) 2025-26 had been approved. READ ALSO: ECC approves Rs100bn TSG for austerity fund The MoNFS&R apprised the ECC that in pursuance of the INWP, the federal and provincial governments were mandated to procure 6.25 million metric tons (MMT) of wheat for strategic reserves through private sector participation. The federal government would procure 1.5 MMT of wheat including annual requirement of Azad Jammu & Kashmir and Gilgit-Baltistan, while the remaining 4.75 MMT would be procured by the provincial governments with the break up; i.e., Punjab 2.5 MMT, Sindh 1.0 MMT, Khyber Pakhtunkhwa 0.75 MMT, and Balochistan 0.5 MMT. The MoNFS&R further apprised the forum that in order to ensure a transparent, competitive, and market-driven procurement process among the private firms, the MoNFS&R had prepared a Request for Proposal (RFP) to be floated through PPRA website and E-PADS, by adopting Single Stage - Single Envelope procedure. It was informed that there was no Policy Framework for carrying out this exercise and therefore, the terms and conditions of the RFP provided the necessary framework. Salient features of the RFP are as follows: (i) 1.5 MMT is divided into 150 lots of 10,000 MT each geographically dispersed; (ii) a bidder can bid for a minimum 1 lot and maximum 25 lots, except when there are un-bid lots; (iii) bidder must have a minimum annual turnover of Rs 1 billion, calculated as an average over the last three financial years; (iv) bidder may create a limited lien in favour of a financial institution solely for financing purpose only, provided that such lien does not confer any operational ownership or control rights over the wheat stocks or services; (v) each bid will comprise of procurement services, storage services and associated financial costs; (vi) payment of financial costs shall commence upon completion of procurement of at least one lot and shall continue until full release of the wheat stock, calculated proportionately based on the quantity remaining under storage; (vii) payment for storage services shall continue for a period of sixty days after the full release of wheat stocks or until completion of the SLA period, whichever occurs earlier; (viii) procurement services will be paid for full duration of SLA; (ix) all service payments shall be made on a monthly basis, subject to verification and approval of the service provider’s monthly invoice, excluding the cost of wheat; (x) payment for released wheat shall be made by MoNFS&R to the service provider at a fixed rate of Rs 3,500 per maund (40kg) within one month from the date of release and; (xi) if any lot remains un-bid at the conclusion of the bidding process, MoNFS&R may, without initiating a fresh bidding process, offer such un-bid lot(s) to successful bidders of other lots subject to their available operational capacity and the maximum cap of 25 lots per bidder as specified in the RFP. Among the successful bidders who express willingness and have not reached the maximum cap of 25 lots, such un-bid lot(s) shall be allocated based on the lowest evaluated responsive rate offered by the bidder for any lot already awarded to that bidder under the RFP. The rate applicable to the additionally allocated lot(s) shall be the lowest of the evaluated rates at which that bidder has been awarded any lot. No revised or fresh financial bids shall be invited or accepted. If any lot remains unallocated after application of the above mechanism, MONFSR may, as a last resort and without initiating a new bidding process, offer such remaining lot(s) to successful bidders who have already reached the maximum cap of 25 lots, subject to confirmation of operational capacity and acceptance by the bidder. In such cases, the rate applicable to the additionally allocated lot(s) shall be the lowest evaluated rate previously offered by the bidder for any lot awarded to it under this RFP. The MoNFS&R appraised the forum that as per the INWP, the federal government would compensate to the operators for procurement Services, Storage Services and associated financial costs to the extent of strategic reserves only and the actual cost would be discovered through bidding. However, the total estimated financial allocation required for procurement of services of successful bidders for the procurement, storage and handling of 1.5 MMT of wheat was estimated to be Rs. 31.56 billion. It was informed that the disbursement to the service providers would be made at the end of each month and the expected fund requirement for April-June 2026 would be Rs. 5.26 billion, and for the remaining three quarters from 1” July 2026 to 31 March 2027, the fund requirement would be expected to be Rs. 26.30 billion during FY 2026-27. The Ministry of National Food Security & Research requested the ECC to consider and allow to: (i) procure 1.5 MMT of wheat for federal strategic reserves including annual requirement of Azad Jammu & Kashmir and Gilgit-Baltistan, through a transparent competitive bidding process among the private sector service providers as per scheme of bidding;(ii) authorise a total financial allocation of Rs. 31.56 billion to MoNFS&R subject to actual requirement discovered after bidding to be disbursed in four quarters; i.e., Rs. 5.26 billion in the last quarter of FY 2025-26 (1 April to 30th June 2026) and Rs. 26.30 billion over the remaining three first quarters of FY 2026-27 (1st July 2026 to 31st March 2027); (iii) Finance Division to open an ESCROW account for adequate advance deposits so that payments are made to the service providers without process delays every month and allow Finance Division to open an ESCROW account for adequate advance deposits so that payments are made to the service providers without process delays every month; and (iv) approval for the hiring of a third-party validation/ consultant firm to independently monitor and verify the entire wheat procurement process, including verification of wheat stocks in terms of quality and quantity, from procurement up to the completion of this process in 12 months. Cost of hiring will be discovered through bidding process. During the ensuing discussion, the MoNFS&R presented the wheat stock position in the provinces and the federal level and the need to procure the strategic wheat reserves to meet the prospective wheat requirement in the country, particularly in line with the Interim National Wheat Policy (INWP). The forum also highlighted the significance of analysing objectively the need for procuring additional reserves of wheat. The MoNFS&R emphasised the importance of maintaining strategic reserves based on best available practices particularly to incentivise the farmers to attract them to the wheat cultivation and avoid import of wheat. The ECC advised the MoNFS&R to prioritise utilising wheat stock available with PASSCO and commercial reserves before considering any probable wheat import and approved the procurement of 1.00 MMT wheat, to maintain the federal strategic wheat reserves, including annual requirements for Azad Jammu & Kashmir and Gilgit-Baltistan, through a transparent competitive bidding process among the private sector service providers. After detailed discussion the ECC on the proposal titled “Procurement of Services for the Procurement, Storage and Handling of 1.5 MMT of Wheat for Strategic Reserves through Private Sector under Interim National Wheat Policy 2025-26” approved to procure 1.00 MMT of wheat for federal strategic reserves including annual requirement of Azad Jammu & Kashmir and Gilgit-Baltistan, through a transparent competitive bidding process among private sector service providers as per scheme of bidding. Regarding proposals in terms of operationalisation plan, the forum directed detailed consultation between MoNFS&R and Finance Division with input from Coordinator to Prime Minister on Food Security, for refining the proposal and re-submission before ECC by mid-May 2026. Copyright Business Recorder, 2026
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