Punjab announces Rs10 billion flour subsidy as price hike bites

LAHORE: Punjab Chief Minister Maryam Nawaz has approved a Rs10 billion subsidy to hold down flour prices across the province and ordered more government wheat released to flour mills.

The decision came on Saturday at an emergency video-link meeting, where the chief minister voiced strong displeasure at the rise in prices and told officials to keep wheat and flour affordable under all circumstances.

What the Rs10 billion package covers

The meeting raised the quota of subsidised government wheat for flour mills, fixing it at Rs3,800 per maund, and told officials to use all available resources so the relief reaches households.

“The burden of inflation on the people of Punjab is extremely painful. We will utilise all available resources to ensure the supply of flour at affordable prices,” the chief minister said.

The move is a sharp turn from the tone set days earlier. On Wednesday, Director General Food Amjad Hafeez said there was no shortage, claiming mills had supplied 470,845 ten-kilogram bags in one day, nearly half of it milled from government wheat.

Prices still climbing despite official supplies

The intervention follows a sharp rise in open-market wheat prices. Wheat in Punjab has reached about Rs5,200 per 40 kilograms after climbing Rs400 in four days, according to market reports. Millers blame delays of more than two weeks in the release of government stocks.

The Pakistan Bureau of Statistics recorded a 5.69 per cent jump in flour prices in a single week, taking the average price of a 20kg bag to Rs2,851 in the week ended October 8, up from Rs2,697 a week earlier. A year ago, the same bag cost Rs2,150. Short-term inflation has climbed to 11.97 per cent year on year, with flour leading the weekly rise.

City data from the PBS shows wide differences. The 20kg bag stood unchanged at Rs2,300 in Lahore and Rs2,200 in Faisalabad, near the controlled rate. In Rawalpindi it rose by Rs347 to Rs3,333 and in Sialkot to Rs3,133, while Multan stood at Rs2,866 and Karachi, Islamabad and Peshawar at Rs3,400.

Wholesalers warn flour could hit Rs250 a kilo

Wholesalers say the pressure is getting worse. In Karachi, Abdul Rauf Ibrahim of the Wholesale Grocers Association called the daily increases alarming: mill flour has reached Rs155 a kilogram and chakki flour Rs180. With imported wheat due in November, he warned flour could touch Rs250 a kilogram if nothing was done.

Millers have raised rates before: flour prices jumped Rs14 per kilogram earlier in the year when wheat costs rose. In Sindh, chakki owners have rejected the official wheat issue price. In Peshawar, flour has reached Rs3,300 for a 20kg bag, while roti sellers there charge Rs30.

Questions over how the subsidy will reach buyers

The opposition says the crisis grew out of the government’s own procurement model. Dr Muzammil Iqbal Hashmi, central spokesman of the Pakistan Markazi Muslim League, said the government bought wheat from farmers at around Rs3,500 per maund through 11 private companies and that the price had since risen to Rs6,000 by his count. He argued that neither growers nor consumers had gained.

He demanded that the government state plainly whether the Rs10 billion would lower prices for consumers or raise private profits, and called for disclosure of procurement details and action against hoarders.

Punjab’s Wheat Policy 2026 set a Rs3,500-per-maund benchmark and handed reserve-building to private firms, with the government covering 70 per cent of their borrowing costs. An NA body now wants the support price fixed at Rs5,000 per 40kg for the rabi season.

Former finance minister Asad Umar said on X that flour was up 21 per cent in a year and 81 per cent since Shehbaz Sharif took office, with poor households cutting food intake by 16 per cent, citing the World Bank. The centre has also ordered tighter price monitoring as inflation data showed mixed trends.

Sindh has moved separately, approving a subsidised wheat release to keep flour affordable.

FAQs

How much is the Punjab flour subsidy?

Rs10 billion, approved by Chief Minister Maryam Nawaz on October 10, 2026.

At what price will mills get government wheat?

The raised quota fixes subsidised government wheat at Rs3,800 per maund.

What is the average flour price now?

PBS put the average at Rs2,851 for a 20kg bag in the week ended October 8, 2026.

Why are flour prices rising?

Open-market wheat has reached about Rs5,200 per 40kg in Punjab. Millers say government stocks were released late, while the food department earlier denied any shortage.

What do wholesalers expect next?

Abdul Rauf Ibrahim of the Wholesale Grocers Association says flour could reach Rs250 a kilogram if nothing is done, with imported wheat due in November.

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*Source reporting: The Express Tribune, Bloom Pakistan (Maryam Nawaz approves Rs10 billion flour subsidy), ghanamma.com (Punjab approves Rs10bn flour subsidy).*