Sugar has to arrive within three weeks after the opening of the letter of credit. The terms and conditions are similar to those contained in the tender documents of last year, which could only be met by the Dubai supplier, stakeholders said. Last year, despite protests, TCP had imported 200,000 metric tons sugar worth USD 110 million from the same source.
Needless to point out, the masses whoh are groaning under the pressure of escalating price of essential commodities, ie flour, sugar, ghee, etc, got another blow last week when the price of sugar being sold by government through Utility Stores Corporation (USC) was raised by Rs 7 per kg. Stakeholders said that while the common people are suffering, unscrupulous elements are making big money with connivance of officials, particularly TCP.
The Corporation has been in the limelight for last one and a half year, facing various allegations. It is currently undergoing investigations by FIA on alleged charges of graft, import of substandard wheat, which was declared unfit for human consumption by the quality control laboratory of Ministry of Food & Agriculture and yet accepted and paid for by TCP without any compensation, and misappropriation of cargo in collusion with stevedoring & transportation cartel.
The same network appears to have geared up its activities during the current sugar tenders and, unless the entire process is closely monitored, may cost national exchequer billions of rupees again. It has been pointed out that a Karachi-based group of companies, which among their other principals, represent a Dubai-based refiner, have managed to get the loyalties of TCP officials to their advantage and are directly and indirectly controlling both the policies and the decisions made by TCP for personal financial gains.
Last year, a tender document for the import of sugar was prepared by TCP which was specifically made to suit one party - the Dubai-based refinery. Coincidently at the time of issuance of that tender document, the then Chairman of TCP was in Dubai, attending a sugar conference, on special invitation of Al-Khaleej Sugar. As per the terms of that tender, sellers were asked to offer basis shipment in containers with goods delivered in the TCP warehouses in Karachi.
This was not only to keep all other international and well reputed sellers out of TCP business and have virtual monopoly over price, but also to have absolute control over quality and quantity without having any checks and balances involved in local handing operations.
This group of companies, along with some local key players who are influential in the local sugar industry and transportation business and have close ties with TCP officials, operate like a cartel, controlling full transaction from the beginning to the end. They own, and control, multiple companies based both in Pakistan and overseas which perform various activities for TCP.
Starting from representing the supplier, they also perform the duties of preshipment inspectors, vessel agents, surveyors, stevedores and transporters on behalf of TCP. This allows them to manipulate both quantity and quality of the product at every stage of transportation with no check or balance since there is no single party safeguarding the interest of the buyer (TCP).
While FIA is investigating the wheat import scandal, this network is continuing with all its might, in collusion with TCP officials, to reap the same benefits from the 2010 TCP sugar import as they did during 2009 TCP sugar tenders. National exchequer would suffer due to high costs that will be paid by TCP on account of high purchase prices due to non-commercial terms, shortage in handling & transportation, and excessive stevedoring and transportation costs. This could only be stopped by the government stepping in to stop cartelisation and provide level playing field to all stakeholders.