Already enduring the unbearable costs of living, hapless people have come under yet another hammer of utilities’ price hike after two more upward revisions of POL prices.The hardest hit has been the kisan.

The farming community is facing an unprecedented increase in the prices of oil, power, fertilizers, pesticides and machinery. The latest increase in the price of diesel is all set to ruin the agri-production, as it is the primary source of energy in the farm sector. It is used to fuel tractors, reapers, thrashers and other equipment.

The price of diesel has risen by around 100 per cent in the last three years. The recent increase has made the diesel sell for Rs19.08 per liter, which is enough to break already strained back of the farmer. It would certainly add to the higher operating expenses and equipment use costs, particularly of fuel powered machinery.

Apart from this, farmer depends heavily on the transport sector for the movement of in-puts and agricultural products from farm to market and vice versa. Higher transportation costs would certainly add to his burdens. Whither steps to boost agriculture?

Not long ago, the government’s decision to impose 17 per cent general sales tax (GST) on fertilizers proved a big blow to the farm sector. One wonders why our economic administration has been so blind folded in following the dictates of IFIs, even in the case of such ruinous decisions. Why they could not argue with the IMF to delay the imposition of GST on this crucial farm input? Revenue generation is no doubt important, but survival and growth of agrarian economy must come first.

Adding to this aggravation, there is ever rising tariff of gas.Higher prices of gas, which is used as a raw material in the fertilizer industry, force the manufacturers to sell their product at the higher rate. Again the ultimate sufferer is farmer, who needs fertilizers for almost every crop.

Moreover, the power tariff has seen frequent upward revisions. Every few days we see Wapda rushing towards NEPRA with demands of increase in electricity rates. Ever since the introduction of so called market-based mechanism, power tariff has been linked to world prices of furnace oil. A few paisas raise per unit translates into increased burden of thousands of rupees on poor farmers using tube-wells. Similar is the situation with all too important pesticides. Their prices have seen a phenomenal raise over the last few years, thanks to various forms of taxes and duties. More ironically, the government is reportedly all set to levy GST on pesticides in the near future. Would this decision not cripple the purchasing power of farmer and ruin the cash crops like cotton and wheat in times to come?

The list of farmer’s grievances does not end here. Next in the line are the hardships he faces when he goes to market or government procurement centres to sell his produce. The irregularities involved in procurement by government organizations like the Passco and the TCP are well-known. There are complaints by the small farmers that food department employees are playing the role of an agent for the powerful middlemen. The reports reaching from interior Punjab and parts of Sindh suggest that farmers are being forced to sell the new wheat crop at rates much lower than the actual support price fixed by the federal government for year 2002-03, i.e. Rs300 per 40 kilogram (maund).

The bare fact is that agriculture has become an expensive business due to various factors plaguing it. Is anybody seriously willing to revive agriculture, the backbone of our economy, which contributes around Rs800 billion, almost one fourth to the total GDP? There is an urgent need to provide incentives to the farming community.

The first and foremost is to evolve a realistic and sustainable price adjustment mechanism for oil, gas and power. The prices should be adjusted in the light of their larger impact on country’s economy, agriculture in particular. The fortnightly review of POL prices does not appear convincing.

The real problem with this system is that prices of other utilities that go up with the POL prices seldom come down, even if the oil prices are lowered and the common man is left to face the consequences.

Equally important is to rationalize the gas tariff so that to check the ever-rising fertilizers prices. Pesticides are essential if we have to increase the quality standards of our crops, particularly cotton, exportable grains, fruits and vegetables. Their prices also demand an effective check.

There is not much time left when we would have to abolish all kind of subsidies and support prices of crops under WTO agreement on agriculture. Our principal exports such as rice and cotton and its byproducts will have to face tough competition in the international markets. Under prevailing circumstances, it is so hard for the farmer to survive, what to say of the competition.

While Mother Nature continues to play havoc with agriculture in the form of water shortages, prolonged dry spell and drought like situation in different parts of the country, the misguided official policies are not less damaging either. The policies aimed at appeasing the international creditors have caused big blows to the economy, specially agriculture. The time demands a paradigm shift right now. Encouraging measure are needed to make agriculture lucrative for farmers. It has become need of the hour to stabilize teetering national economy.