- Punjab govt mulls launching ‘Kissan Card’ programme to ensure ‘targeted subsidy for small farmers’
- Farmers having up to five acres of land will get direct subsidy on fertilisers through National Rural Support Programme
ISLAMABAD: Prime Minister Imran Khan said the other day that facilitation of small farmers was among the foremost priorities of his government.
The prime minister observed this while chairing a meeting that reviewed matters pertaining to agro production, especially the facilitation of small farmers.
Earlier, in a session with a select group of journalists, Engro Fertilizers CFO Imran Ahmed shared that over 50pc of the farmland is owned by less than 10pc of farmers in Pakistan, resulting in landholding being concentrated in the hands of rich landowners.
However, he added, the remaining 90pc of farmers have very small landholdings which highlight the significance of small and subsistence farmers in Pakistan’s agri-sector employment.
In this scenario, the subsidy given by the government on urea produced on imported LNG is directly and disproportionately benefitting the large farm owners, whose agricultural income remains untaxed.
Punjab Agriculture Minister Malik Nauman Langrial, in a closed-door meeting with the media, disclosed that the government planned to unleash a revolution in the agriculture sector by launching the “Kissan Card”, a step aimed at disbursing “targeted subsidy to small farmers”.
“Farmers having up to five acres of land would get direct subsidy on fertilizers through National Rural Support Programme (NRSP). As many as five million farmers will benefit from this in the next two years,” he informed.
The prime minister also pointed out that the agriculture policy, especially the focus on facilitation of small farmers, was the manifestation of the government’s commitment towards the agriculture sector. He said the provision of facilities to small farmers would not only bolster agriculture yield but would also help alleviate poverty.
Currently, the government is bearing Rs38 billion per annum on account of subsidized RLNG to fertilizer plants. Additionally, the government also decided to import 100KT of urea for an approximate amount of Rs6 billion, raising the total cost of these adverse decisions on the national exchequer to Rs44 billion ($275 million). Along with the above, the subsidy to sell imported LNG at cheaper rate annually amounts to Rs21 billion.
According to industry experts, had the efforts been deployed to provide much bigger “smart” subsidies were made earlier, the subsistence farmers would have benefited significantly at a much-reduced cost to the country. Small scale farmers, with less than 5 acres of land can potentially get urea free of cost if this entire amount is targeted to them as a subsidy, they added.
A reduction of even Rs500 per bag in urea price for the small farmers could have been achieved by just spending less than 25pc of the total annual cost of Rs44 billion to run LNG-based plants and import Urea; whereas a similar objective could have been achieved on DAP by just spending 6pc of the total cost. Such a scheme would have benefitted the small farms who need the support in these times of runaway inflation.
Such targeted subsidy would also enable the usage of balanced nutrients in the country. Yields of major crops in Pakistan have remained below peer averages and one of the reasons is the lack of application of balanced nutrients as required by crops for optimum growth.
Experts suggest that farmers can earn billions of rupees through enhanced agri-productivity resulting from the application of balanced nutrition. The targeted subsidy programme introduced by the Punjab government that awarded direct payment to small-scale farmers for P & K fertilizers has led to an increase in the use of these critical soil nutrients by 56pc in the last couple of years.
A similar scheme was introduced by the Punjab government in February 2017 on Phosphorus and Potassic fertilizers in order to promote the balanced use of fertilizers and ensure that the subsidy trickles down to small and subsistence farmers. That scheme was very successful and resulted in improved usage of balanced fertilizers in Pakistan.
The prime minister directed to enhance coordination among the provinces to achieve the targets in the agriculture sector.
