| Year 2011 was difficult for agriculture sector |
Lahore—In
the backdrop of withdrawal of subsidy on agriculture inputs, levy of
General Sales Tax (GST) on electricity, agriculture inputs and
implements, the year 2011 was ‘difficult’ for agriculture sector in
general and the growers in particular.Due to these factors, not only
input cost rose to 35-percent but at the same time produce price of some
of the major crops such as cotton, rice and sugarcane dropped by
25-percent, agriculture experts said. According to Pakistan Agricultural
Scientists Association (PASA) Chairman Mr. Jamshed Iqbal Cheema, the
year 2011 was “a year of loss” for the farming sector.
He said the government had not only withdrawn subsidy from the agricultural inputs and electricity but also imposed General Sales Tax (GST) on them due to which prices of input increased too much and its usage dropped hampering the performance of the agriculture sector. Mr. Jamshed Iqbal Cheema claimed that imposition of GST on fertilizer sector had witnessed 30-percent decrease in DAP usage besides decrease in usage of Urea and pesticides. Similarly, he said both federal and provincial governments had become heavy borrowers due to which loan spread for agricultural sector squeezed. ‘Agricultural sector which has 23-percent share in the GDP should have at least same amount of share in the loan spread from the commercial branches to keep it going,’ he argued.
Mr. Jamshed Iqbal Cheema said that loaning had not only squeezed for the farmers but also for those involved in the business of agricultural inputs and agricultural produce. ‘Loan spread has even squeezed for those sheller owners, flour millers and arhtis,’ he said, adding: “Price of any crop is stabilized and leave profit for the grower when market is ready to buy at least 70-per cent of the produce in one go. But with the decrease in funds (by virtue of decrease in loaning) market would not be able to buy the produce with that ratio rather would hardly buy 40-50-per cent of the produce then the prices would start falling.”
He claimed that agriculture sector does not have that much funds to buy 70 per cent produce in cash. Giving example, he said the government had announced Rs 1050 as support rate for 40 kilograms of wheat, but it could be ensured only when the market have funds to buy this produce and maximum buyers are in competition to buy wheat.
Mr. Jamshed Iqbal Cheema said absence of food processing industries, storage and other value-addition industries was another issue which could not be tackled by any government despite tall claims during the present year. ‘No new scheme or investment was brought in this sector which could not only overcome waste of perishable and non-perishable agricultural commodities but could also help both producer and consumer in shape of sustained prices,’ he regretted.
To a question, he said that the government should decrease the prices of agricultural inputs, improve marketing system for this sector and enhance loan spread besides investing in research to increase per acre yield. These steps are essential to overcome food shortage and avoid any threat to food security in the future.
He said the government had not only withdrawn subsidy from the agricultural inputs and electricity but also imposed General Sales Tax (GST) on them due to which prices of input increased too much and its usage dropped hampering the performance of the agriculture sector. Mr. Jamshed Iqbal Cheema claimed that imposition of GST on fertilizer sector had witnessed 30-percent decrease in DAP usage besides decrease in usage of Urea and pesticides. Similarly, he said both federal and provincial governments had become heavy borrowers due to which loan spread for agricultural sector squeezed. ‘Agricultural sector which has 23-percent share in the GDP should have at least same amount of share in the loan spread from the commercial branches to keep it going,’ he argued.
Mr. Jamshed Iqbal Cheema said that loaning had not only squeezed for the farmers but also for those involved in the business of agricultural inputs and agricultural produce. ‘Loan spread has even squeezed for those sheller owners, flour millers and arhtis,’ he said, adding: “Price of any crop is stabilized and leave profit for the grower when market is ready to buy at least 70-per cent of the produce in one go. But with the decrease in funds (by virtue of decrease in loaning) market would not be able to buy the produce with that ratio rather would hardly buy 40-50-per cent of the produce then the prices would start falling.”
He claimed that agriculture sector does not have that much funds to buy 70 per cent produce in cash. Giving example, he said the government had announced Rs 1050 as support rate for 40 kilograms of wheat, but it could be ensured only when the market have funds to buy this produce and maximum buyers are in competition to buy wheat.
Mr. Jamshed Iqbal Cheema said absence of food processing industries, storage and other value-addition industries was another issue which could not be tackled by any government despite tall claims during the present year. ‘No new scheme or investment was brought in this sector which could not only overcome waste of perishable and non-perishable agricultural commodities but could also help both producer and consumer in shape of sustained prices,’ he regretted.
To a question, he said that the government should decrease the prices of agricultural inputs, improve marketing system for this sector and enhance loan spread besides investing in research to increase per acre yield. These steps are essential to overcome food shortage and avoid any threat to food security in the future.
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