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Friday March 29, 2024

PM, FIA DG being threatened by sugar mafia

By Ansar Abbasi
April 05, 2020

ISLAMABAD: Sugar mafia has threatened the Prime Minister Imran Khan as well as DG FIA/Chairman of the Inquiry Commission Wajid Zia to immediately stop the probe into the sugar scam otherwise the country will see severe shortage of the commodity and its price may go up to Rs 110 a kilogram.

In a rare but bold move, the Prime Minister Imran Khan on Saturday made the report on wheat and sugar scandals public and there are strong indications that some major administrative actions may follow in the coming days.

Informed sources said that not only heads will roll from within the bureaucracy but Prime Minister Imran Khan is also considering removing some of his key ministers from the cabinet besides expelling Jehangir Tareen from the PTI.

A PM’s adviser’s role as head of the Sugar Advisory Board came into question whereas a top PTI leader not only is in the focus for being one of the leading sugar tycoon but was also head of Task Force on Agriculture.

The sources said that the prime minister was threatened that if the Sugar Commission continues its probe for criminal action against those involved, the country will face on the worst sugar crisis.

It is said that DG FIA Wajid Zia, who is heading the Commission, has also been asked to stop the probe otherwise the sugar price will go up to Rs110. The DG FIA informed the PM’s Office about the threat he received.

Sugar Inquiry Committee led by Wajid Zia had submitted to the prime minister its findings. On its recommendations the Committee was converted into Sugar Inquiry Commission, which was assigned by the government to go deep into the operations of the Sugar industry and unearth the mafia.

The Commission, which has to give its report to the prime minister on April 25, is at present checking the legers, bank reports, export details, markets sales etc of the sugar mills.

The Commission’s ongoing probe, it is said, is badly hurting the sugar mafia, which is now exerting pressure on the government to halt the Commission’s probe. The sources said that the Commission has already noticed a lot of fraudulent acts. For example, in some cases the brokers who are sold sugar by the sugar mill turned out to be truck drivers.

The Commission report will enable the government to initiate criminal action against those involved.

The finding of Inquiry Committee about sugar crisis and price hike in Pakistan has put blame on the decision of allowing export of sugar in 2018 and subsequently Punjab providing subsidy to tune Rs3 billion.

According to the findings when PTI government came into power in 2018 there was sugar surplus in the country. Therefore, Sugar Advisory Board (SAB) under Chairmanship of Advisor Commerce, Industries and Production recommended export of one million tonne, which was approved by the ECC despite the fact that Secretary Food Security raised the concern about expected lower sugar production next year. Sugar export was allowed and later Punjab added subsidy for the export.

According to the Committee findings from January 2019 till May 2014, sugar was exported availing subsidy given by Punjab. It has been highlighted that during this period sugar prices in local market increased from Rs55 per kg to Rs71 per kg. Therefore, the sugar exporters benefited in two ways. First by availing the subsidy of Rs3 Billion and secondly reaping the benefit of price hike in local market.

Sugar Committee also highlights the major beneficiaries of export subsidy and price hike. Maximum benefit of export was drawn by JDW Group (Jahangir Khan Tareen) by availing 22% of total subsidy worth Rs561 million.

Second highest was RYK Group run by Makhdoom Omer Sheheryar Khan (Brother of Khusro Bakhtiar) availing 18 percent of subsidy worth Rs452 million. This Group ownership also includes Ch Munir and Moon's Ellahi. Third highest was Mr. Shamim Ahmed Khan (Al Moiz Group) availing 16 percent of subsidy worth Rs406 million.

Committee suspect involvement of Sugar Mills and wholesale dealers of sugar in collusion behind this practice however indicates that the Commission constituted by the federal government can unearth evidence and parties involved.

The Committee also reported that a subsidy of Rs25 billion was given to sugar mills in the last five years. Rs3 billion was given last year.

According to consolidated data RYK group has been largest beneficiary with total subsidy of Rs4 billion, JDW over Rs3 billion, Hunza Group at Rs2.8 billion, Fatima Group at Rs2.3 billion, Sharif Group at Rs1.4 billion and Omni at Rs901 million.

The Committee has indicated that Commission formed by the Federal Government will further conduct forensic audit of sugar industry to unearth all such practices, which could lead to penal/ regulatory actions and also recommendation for rethinking of future agriculture strategy.