The Economic Coordination Committee (ECC) has turned down a proposal to wind up the Pakistan Agricultural Storage and Services Corporation (Passco) and establish a new Special Purpose Vehicle (SPV), after the Securities and Exchange Commission of Pakistan (SECP) raised objections over the structure and legal documentation of the proposed entity, as reported by The Express Tribune.
The decision came during a recent ECC meeting where the Ministry of National Food Security and Research presented the background of the plan.
SECP told the committee that the Law and Justice Division must first vet the Memorandum and Articles of Association for the proposed SPV. It also objected to the proposed Rs350 billion authorised capital, suggesting it be reduced to Rs5 billion since the SPV’s role would be limited to winding up Passco.
Following the objections, ECC directed the ministry to address the issues raised and resubmit a revised summary in the next meeting. The committee specifically instructed the ministry to revise the authorised capital and ensure that the Law Division examined the incorporation documents.
The Ministry of National Food Security briefed the ECC that Passco, established under the Companies Ordinance 1984 (now Companies Act 2017), was mandated to procure wheat for maintaining national reserves. The Prime Minister’s Office had earlier issued directives on September 12, 2024, March 21, 2025, and August 25, 2025, instructing the federal government to wind up Passco and develop an alternative mechanism for strategic wheat reserves, assigning the finance minister to lead the process.
A committee led by the finance minister held five meetings between September and October 2025 to review modalities for the disposal of wheat stocks, settlement of receivables, and closure of liabilities. According to the ministry, Passco’s liabilities stood at Rs527.664 billion, while projected recoveries from wheat sale proceeds, dues from agencies, and disposal of assets would still leave a Rs121 billion shortfall.
Since the residual amount could not be financed immediately, the ministry proposed setting up an SPV, the Wheat Stocks Management Company Public Limited, under Section 32 of the Companies Act 2017. The SPV would raise long-term bank financing under a sovereign guarantee, with the federal government servicing its debt through annual budgetary allocations over five to seven years.
The ECC, however, deferred approval and asked the ministry to revise the proposal in line with SECP’s observations before bringing it back for consideration.
