Wheat or grain Markets and Price Stabilisation in Pakistan:
An Evaluation of Policy Options
PAUL DOROSH and ABDUL SALAM*
This article offers a quantitative research of the associated with Pakistan government domestic wheat or grain procurement, sales, and operate policies in wheat source, demand, prices, and overall inflation. Research of price multipliers shows that improves in whole wheat procurement rates (one way of promoting home-based procurement) have got relatively little effects around the overall customer price index. Partial balance analysis of wheat market segments suggests that variances in development, rather than industry manipulation, will be plausible answers for price increases recently. Comparisons of domestic and international rates suggest that endorsing private sector imports can be one option for elevating supply and stabilising market prices, especially in years of production shortfalls. Overall, this kind of paper concludes that marketplace forces perform a prominent role in cost determination in Pakistan, and that policies that promote the private sector wheat control can the two increase price stability and reduce fiscal costs. JEL category: Q11, Q18
Keywords: Foodstuff Policy, Meals Price Stabilisation, Agricultural Coverage, Food Value Inflation
I actually. INTRODUCTION
Wheat or grain plays a central part in Pakistan's food overall economy, both in terms of creation and intake. Because of the importance of wheat, successive governments of Pakistan since Independence possess intervened heavily in wheat markets, procuring wheat in administratively set prices to support farmer incomes and subsidising wheat product sales to flour mills or directly to consumers with the objective of stabilising prices at levels affordable to consumers [Cornelisse and Naqvi (1987); Hamid, Nabi, and Nasim (1990); Dorosh and ValdГ©s (1990); Ashfaq, Griffith, and Parton (2001); Ahmad, et al. (2005)]. Significant methods were used toward liberalisation of wheat markets through the late eighties to 2150. However , after consecutive...