ONION VERSUS TOMATO
Feb 14 - 20, 2011
Pakistan is a very blessed but an unfortunate country. According to the UN Food and Agriculture Organization (FAO), Pakistan has emerged as the second largest producer of buffalo meat, buffalo milk, and chickpeas according to its global statistics finalized for the year 2007.
The FAO figures ranked Pakistan as the third largest producer of pulses and seed cotton, fourth largest producer of goat milk, meat, onions, and lint cotton, and fifth largest producer of dates, spices, apricot, dry chilies, and pepper. It is the sixth largest producer of mangoes, wheat, okra, and sugarcane and eighth for un-manufactured tobacco and castor oil.
Pakistan has the second largest salt mines, fifth largest gold mines, seventh largest copper mines, and fifth largest coal reserves.
Pakistan has the sixth largest army, still silent on drone attacks. Pakistan is the ninth largest wheat producer and eleventh largest rice producer in the world, still forty percent hardly get food to eat. Why are prices high in markets? Pakistan imposed complete ban on onion export to India via land route on January 6 to prevent any spiraling hike in onion prices in its country. Vegetable traders of India and Pakistan protested against the ban and shut down their trade. Amritsar-based traders refused to export vegetables, including tomato, to Pakistan via Attari-Wagah land route, though they commenced sending vegetables.
Indian traders have been demanding that the Pakistan government should allow the supply of contracted orders of onion which they made before the imposition of ban.
Close to 300 trucks laden with onion, which were contracted before the ban was imposed, were not allowed to be sent by Pakistan that was a huge loss to traders here and in Pakistan.
India is a major exporter of vegetables to Pakistan as out of total export via land route, 30-32 per cent account for tomato alone. Besides, soybean has a share of 55 per cent and remaining with chilly, ginger, potato, capsicum, biscuits, raw cotton etc.
India started importing onion in the month of December last year for the first time from Pakistan after facing soaring prices of bulb. About 7,000 MT of onion arrived since the commencement of onion export to India from Pakistan via land route.
The recent decision by the government to ban onion exports to India is unwise and may have already provoked Indian retaliation. In trying to prevent the rise in prices of one agricultural commodity, the government may end up causing an increase in the prices of a far greater number of foods items.
Free trade is based upon a simple principle of reciprocity. No country can expect the rest of the world to allow access to its markets and goods if it closes off its own. The government must realize that Pakistan imports a far wider range of food items from India than it exports. If it tries to close off the export of a commodity that India needs in order to keep domestic prices low, India is likely to stop the export of a range of products that Pakistan needs, such as lentils, chickpeas, and spices. Imports from India keep prices of these commodities low in Pakistan and many of them form a staple part of the nation's diet. If imports from India stop, food price inflation, already skyrocketing, will shoot up even further.
This is one of those rare instances where free trade benefits both producers and consumers in Pakistan. Onion farmers benefit from the higher prices they are likely to command on both the domestic and Indian markets, while Pakistani consumers benefit from continued access to cheaper Indian food items. There is no justification for the government to take this step. It is shortsighted policymaking at best and outright incompetence at worse.
The Indian government has not taken any retaliatory steps yet, though a group of Indian exporters have halted shipments to Pakistan. There is still time for the government to reverse the decision. The last thing the country needs right now, as it battles economic and political uncertainty, is to spark a trade war with India. We could not afford it in the best of times. We certainly cannot afford it now.
I really do not see any notion of critical thinking practiced in Pakistan. In history, we have had great poets, writers, journalists but we never actually heard of a great critical thinker that our country has ever produced. It is just because the term critical thinking has never been coined in our country.
Two years back, severe wheat crisis slammed our economy. It was all due to wrong decisions and lack of strategic and planned thinking that we had to import wheat on much higher rates, because of a bunch of people thought we have had bumper crop and to earn more foreign exchange and personal profits they should export it. These unplanned decisions upset our economy so badly that we had to import wheat even after having one of the bumper crops in the history in order to meet local needs. Had there been a notion of critical thinking or thinking of thinking this would not have knocked us and our economy that badly.