Agriculture relief package

Economic Coordination Committee (ECC) of the cabinet has approved a relief package of Rs.50 billion for the agriculture sector. It is part of Prime Minister’s Rs.1200 coronavirus relief package, out of which Rs. 100 billion have been earmarked for small and medium scale enterprise (SME) and agriculture sector. The salient features of agriculture uplift initiative include subsidy on fertilizers, subsidy on high yield variety of cotton seeds, reduced markup on agriculture loans, subsidy on insecticides used against white fly in addition to subsidy in sales tax on the purchase of locally manufactured tractors. Although small measures approved for implementation in relief package for agriculture sector are worth appreciation yet deep rooted causes that have created crisis in the sector also need long term planning and development. The growth of this mainstay sector of the economy has stagnated due to water scarcity, high cost of inputs, lack of uniform policy on minimum support price that hinder increase the net return ratio to 2 percent for small farmers, climate change impact and now the recurrence of locust infestation. The issue of water scarcity, which was utterly neglected for the past four and a half decades, is being seriously addressed by the construction of big storage dams. Construction work on Mohamand dam was started last year and contract has been awarded for engineering, procurement and construction work of DiyamerBasha dam to the joint venture of Power China Company and Frontier Works Organisation, the other day. As per the set schedules the former project shall be completed by 2026 and the latter one by 2028. However, the utility of small and medium storage dams for water conservation cannot be ignored. These useful projects can be launched and complemented within few years from domestic resource mobalisation. The price of genetically modified imported seed is not affordable for small farmers. High yield variety of hybrid seeds can be evolved locally if agriculture research centers are made fully functional in all four provinces. Currently, these centers are operative to greater extent in the province of Punjab alone, doing a commendable job for evolving disease resistant and better productivity seeds of various crops. On the contrary, agriculture research centers in other provinces are plagued by redundancy due to lack of equipment and required chemicals. The ECC has approved subsidy on cotton seeds which will not go far enough in encouraging growers of this crop to increase area under cultivation. The long standing demand of cotton producers is fixing minimum support price at Rs.5, 500 per 40 kilogram of raw cotton. National Assembly Standing subcommittee on agriculture had recommended reasonable amount of increase in minimum support price for cotton, after consultation with stake holders that comprised representatives of farmers and All Pakistan Textile Mills Association (APTIMA). Farmers are not satisfied by fixing the minimum support price of wheat at Rs.1500 per 40 kilogram.