The federal government has moved forward with the closure of the Pakistan Agricultural Storage and Services Corporation Limited. The decision comes as PASSCO faces a remaining liability of around Rs. 121 billion after the adjustment of its wheat stocks, receivables and assets.
To manage this financial burden in an organised and responsible way, the government has approved the creation of a new Special Purpose Vehicle called Wheat Stocks Management Company Public Limited. This new firm will handle the settlement of the remaining liabilities and ensure a smooth transition from PASSCO’s longstanding role.
For many years, PASSCO played a central role in purchasing wheat for the country’s strategic reserves. However, the federal government has revised its involvement in wheat sector operations. The Prime Minister’s Office issued directions on several occasions in 2024 and 2025 to gradually wind up PASSCO and design a new system for managing national wheat reserves.
A committee led by the Finance Minister held multiple meetings in September and October 2025. The committee discussed PASSCO’s financial liabilities, its recoverable amounts, the disposal of wheat stocks and the mechanism needed to complete the organisation’s closure.
PASSCO’s total liabilities stand at Rs. 527.664 billion. After necessary adjustments, Rs. 121 billion will still remain. To address this gap, the government will incorporate the Wheat Stocks Management Company under the Companies Act 2017. The company will raise long-term financing from banks with a sovereign guarantee from the Government of Pakistan. These funds will be used only for clearing PASSCO’s remaining debt. The federal government will then repay the amount over a period of five to seven years.
The Economic Coordination Committee has been asked to approve the new company with a paid-up capital of Rs. 1 million and an authorised capital of Rs. 350 billion. The Ministry of National Food Security and Research will prepare the incorporation documents, while the reduced incorporation fee of Rs. 10,000 has been proposed due to its fully government-owned status.
Additional approvals seek to fund incorporation costs through existing ministry resources, exempt the new entity from the State Owned Enterprises Act 2023 and allow it to dissolve itself once its mandate is completed. Senior officials from the finance and food security ministries will act as initial subscribers, while an interim CEO will run the company until the Board appoints a full-time chief.
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The creation of this new company is expected to ensure a financially stable and efficient approach to managing strategic wheat reserves, replacing PASSCO with a more streamlined structure for the future.
