Govt mulls price deregulation of red meat, milk
KARACHI: The federal government plans to deregulate milk, beef and mutton prices by stopping monitoring them, leaving consumers at the mercy of the market players’ demand and supply mechanism.
A meeting was held a few days back in Islamabad to discuss the proposal. Officials from federal and provincial governments and stakeholders agreed that “deregulating red meat and milk prices is necessary to support the development of the livestock sector.”
A meeting participant told Dawn that the need to adopt a regulatory mechanism covering the quality aspects of milk, meat, and mutton was also stressed.
However, consumers’ associations and meat processors will be consulted soon for their views on the proposal.
Animal Husbandry Commissioner Dr Muhammad Akram said the Ministry of National Food, Security and Research (MNFSR) had started a dialogue with stakeholders to deregulate milk and red meat prices.
After stakeholders’ consultation, a summary for the Economic Coordination Committee was drafted and submitted to the Ministry of Law and Justice, Industries and Production Ministry and Finance Ministry for their views and comments.
The regulation of meat and milk prices, among other disadvantages, mainly discourages farmers and investors from making large investments due to the established fact that there is a low and insignificant profit margin against the volume of their investment, Mr Akram said.
The major hindrance to transforming this sector into a corporate sector is the limited use of value addition and product diversification for domestic consumption as well as export purposes, he added.
A representative of the Expenditure Finance Division supported the concept of price decapping and stressed consultation with the provinces to further work on it.
Barrister Adil Kahloon, Deputy Legislative Adviser at the Ministry of Law and Justice, also emphasised that price monitoring and control were the provinces’ prime responsibility. In a recent judgment passed by the Islamabad High Court, the provinces were mandated to control the price of food items.
He said the federal government can work only on policy decisions up to the jurisdiction of Islamabad Capital Territory.
A representative of Balochistan’s Dairy Development Department said it had supported the price decapping of milk and meat and Balochistan had already initiated the process for the approval of the cabinet, which is still under consideration.
Dr Hizbullah Bhutto, Director General, Livestock and Fisheries Department, Sindh Government, suggested that farmers associations, meat processors and retailers should be consulted with relevant stakeholders.
He said the cost of milk and meat production should be estimated at different production systems in the country and prices of these items should be rationalised accordingly.
Dr Mohammad Mohsin Kiani, Sector Specialist, Livestock Ministry of Planning and Development and Special Initiative, while appreciating the federal government’s initiative, proposed that besides this reform, a regulatory mechanism should be developed to support a free economy on scale besides investment in quality of animal products.
Muhammad Akhtar, Director of Agro Products at the Ministry of Commerce, suggested conducting research on regional economies to replicate price decapping models.
Dairy Cattle and Farmer Association President Shakir Gujjar requested all the stakeholders join hands for an effective mechanism for milk and meat price control. The estimation of milk cost should be rationalised according to input cost.
Published in Dawn, May 26th, 2024