ISLAMABAD: Pakistan’s Economic Coordination Committee (ECC) on Tuesday approved the sale of 500,000 metric tons of wheat at revised reserve prices after an earlier attempt to offload the stock failed due to insufficient bids, according to a statement issued by the Finance Division.

The move comes as the government seeks to reduce mounting wheat inventories held by the Pakistan Agricultural Storage and Services Corporation (PASSCO) and cut associated storage and financing costs amid fiscal consolidation under a $7 billion International Monetary Fund (IMF) stabilization program. Wheat pricing is politically sensitive in Pakistan, where flour is a staple commodity and closely linked to inflation.

Managing excess procurement stocks has become a balancing act for policymakers, who are attempting to control food inflation while limiting subsidy pressures and budget deficits.

“The Committee was informed that an earlier attempt to sell the wheat at previously approved reserve prices could not be finalized due to lower bids received,” the Finance Division said in its statement.

The ECC approved the disposal of wheat through competitive bidding on a First-In-First-Out (FIFO) basis at revised reserve prices of Rs4,150 ($14.8) per 40 kilograms for locally procured wheat and Rs3,800 ($13.6) per 40 kilograms for imported wheat.

Pakistan is one of the world’s largest wheat producers and consumers, and government procurement and pricing decisions often ripple through domestic markets, affecting food inflation, rural incomes and fiscal spending. The country’s wheat policy has been closely scrutinized in recent years after bumper crops, fluctuating import decisions and subsidy adjustments created volatility in local markets.

For international investors and multilateral lenders, inventory management and subsidy rationalization are seen as critical elements of Pakistan’s broader economic reform agenda. Large public stockpiles carry financing and storage costs that add to fiscal pressure, particularly at a time when Islamabad is seeking to narrow budget deficits and stabilize its external accounts.

Pakistan has also faced periodic wheat supply disruptions in recent years, prompting emergency imports that strained foreign exchange reserves. The current decision signals an effort to clear accumulated stock while recalibrating price expectations in the domestic market.

Separately, the ECC approved a technical supplementary grant of Rs536 million ($1.9 million) for projects under Pakistan’s Public Sector Development Programme (PSDP), the federal government’s main infrastructure and development funding framework. 

The allocation relates to projects previously overseen by the now-defunct Pakistan Public Works Department (Pak-PWD), whose functions were recently transferred to provincial authorities as part of administrative restructuring and fiscal rationalization measures. The funds will be transferred to the governments of Punjab and Khyber Pakhtunkhwa in accordance with relevant legal provisions.

In addition, a summary by the Petroleum Division regarding a fact-finding report on a deed of settlement with Cnergyico PK Limited, one of Pakistan’s largest oil refining and marketing companies, was tabled. 

The matter concerns delayed payments of petroleum levy, a key federal revenue source collected on fuel sales that contributes significantly to Pakistan’s budget financing. The ECC returned the summary with directions for a more comprehensive presentation at a subsequent meeting.