FIA starts inquiry into monopoly, irregularities in food ministry’s department

ISLAMABAD: The Federal Investigative Agency (FIA) has launched an investigation into the alleged irregularities and monopoly of private firms in the Department of Plant Protection (DPP), an attached department of the Ministry of Food Security and Research (MoFS&R). The inquiry report, prepared by a committee on the directives of the Prime Minister Secretariat, was submitted to the Secretary MoFS&R early last year, but the influential private firms that control the department succeeded in shelving it for over a year.

The 15-page report, which is now exclusively available with this scribe, reveals that a powerful mafia practically runs the affairs of the DPP, especially in the major role of the fumigation process of all imported and exported agriculture items. The committee was assigned to investigate the controversy over the import of Methyl Bromide (MB), used for fumigation, and the monopoly in this sphere. The report states that it appears that DPP is no longer a federal entity as far as the issuance of biosecurity and phytosanitary certificates is concerned, as it is influenced and practically run by the fumigators who virtually control the entire value chain of the business.

The report further highlights that the majority of the department officers are compromised and/or afraid of doing anything against the mafia for fear of repercussions, and that there is a subculture of corruption, backbiting, infighting, and responsibility-shirking that has seeped into the very roots of the organization. The Director General (DG), all directors, and deputy directors are part of the problem rather than the solution, even if some of them may not be financially corrupt.

The report also states that the importer of Methyl Bromide and fumigating companies were all one party, due to which not only there is a monopoly, but also higher costs being charged to importers/exporters by the fumigators. The decision about the right price of fumigation can not be left to private actors if the volume of private actors’ business is a result of regulatory action. If fumigators collude with the department, it will increase the cost of imports and exports and lead to unreasonable profits.

The Prime Minister Secretariat had directed the food ministry to address the issues and fix responsibility for any wrongdoing that may have occurred in the past in December 2021 after hearing complaints about the monopoly of a company in DPP. However, the ministry kept the report secretly without any further action, apparently after the change of government in the center. The PM office has also reportedly shown its strong displeasure over the ignorance of the ministry regarding this important issue, which ultimately undermines the country’s exports.

A History of Corruption and Monopolisation  

In September 2021, the FIA initiated an investigation into the issuance of bogus phyto certificates by the MoFS&R and DPP. Both organisation are infamous for their malpractices involving corruption and monopolisation. A series of documents submitted to the Prime Minister’s office, the National Accountability Bureau (NAB), FIA and other relevant authorities revealed the ubiquitous corruption dominating the agricultural sector in Pakistan, facilitated by officials in MoFS&R and DPP.

The documents referred to a ‘mafia,’ that controlled all operations and remained unaffected despite numerous complaints registered by a plethora of trade bodies such as the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Karachi Chamber of Commerce and Industry (KCCI) and other trade associations. Simultaneously,  importers and exporters of agricultural products were reportedly harassed by the DPP staff at seaports and airports on a regular basis.

According to details, a particular blue-eyed company had been given the contract for importing methyl bromide (used for fumigation), while other companies were deterred from engaging in the business. Additionally, other related agricultural contracts had been awarded to its sister companies, carving out a clear monopoly.

Ahmad and Kamran Traders (Pvt) wrote a letter to the Prime Minister detailing that a singular company, National Chemicals, was importing methyl bromide from the USA. “Though there are 54 fumigation companies that are registered with the DPP, only their sister fumigation companies namely Adeel Pesticides, Pak Pansy, Pest Management Pentagon Fumigation Services, and Tahir Fumigation Expert are importing and exporting fumigating goods and charging sky high rates.”

Ironically, the company itself had been denied the registration by DPP officials. 

The complaint further elucidated that methyl bromide was only permitted for use in order to control quarantine pests around the world. However, malpractice reigned Pakistan and the chemical was blindly utilised to fumigate every good entering the country, without any legal checks.

According to the available documents, three FIA inquiries ENQ-21/2021, No, 68/2021, No, 518/2021 and one NAB enquiry No, 4924/19 were in process against the ministry and its plant protection department officials at present.

Further allegations entailed that the fumigators and relevant DPP officials issued fake fumigation certificates with exported containers. 

Another allegation against Director Quarantine, Sohail Shehzad stated that he had  received hundreds of complaints from abroad which he kept deleting, as he used his personal email along with the official government email ID. He was not available for comment despite repeated attempts by Profit.

Moreover, on the alleged advice of ‘corrupt’ officials at DPP, a methyl bromide manufacturing Chinese company, Linhai Jianxin Chemical Co. Ltd., had recently issued an exclusive dealership for the Pentagon fumigation, a sister company of National Chemicals, while canceling other companies’ letter of authorisation without any valid reason, despite the fact that Pentagon did not have a registration certificate.

According to sources, despite the widespread cases of corruption, mismanagement and incompetency of such an integral government organisation, the DPP had remained without a head since October, 2020. Furthemore, it continued to function without a regular director general (DG) for over a decade now.

Given the dire situation, various trade associations demanded the Prime Minister (PM) Imran Khan to form a JIT to investigate the DPP’s affairs. The JIT, they believed, should also check the assets and travel histories of alleged corrupt officers to explore the depths of the organisation’s corruption.

Moving Forward

The present-day investigation comes as a relief for the stakeholders of the country’s agriculture industry, who have been bearing the brunt of the fumigators’ monopoly and corruption for years. The FIA has summoned officials of DPP for a hearing in Islamabad on April 03, 2023, to investigate the matter further.