LAHORE, Jan 28: The Farmers Associates Pakistan (FAP) on Tuesday urged the government to lower the interest rates for farmers, increase the wheat support price and ensure that growers get the prescribed price for sugarcane.

Speaking at a press conference, Aafaq Tiwana said all banks should emulate the example set by the Bank of Punjab, which was still able to make profits after lowering the interest rate on agricultural loans by four to six per cent. The government must force other banks into doing the same, because the Bank of Punjab had a very limited agriculture loan outlay, he added.

He said the State Bank should also take steps for enabling the farmers to purchase agricultural inputs on bank guarantees. The bank guarantees are available at one to two per cent whereas loans cost around 10 per cent. This, he said, would substantially lower the burden on farmers.

The State Bank must also ask all commercial banks to start giving commodity loans to farmers, he added.

The Rs300 per 40kg support price of wheat, he claimed, had also become redundant because of the ever-increasing input prices. The previous government increased this price from Rs240 to 300 in the year 1999. The farmers responded by making the country a wheat-exporting one in a year’s time. The Agriculture Price Commission estimated the production price at Rs307 per 40kg for the year 2001-02.

Pakistan, he said, was the only country where government had been taxing agriculture. Governments the world over, he added, were heavily subsidising farmers. However, in Pakistan, farmers are paying high taxes, exorbitant utility bills and an abnormally high diesel price. All these factors have rendered the sector non-competitive and non-profitable.

The government had also failed to ensure payment of the support price of sugarcane. None of the millers is paying the price fixed by the provincial government. The district governments, which are supposed to ensure the price, have failed miserably in this regard. The provincial government must make a determined effort to save the farmers, he demanded.

Mr Tiwana also warned of an impending potato crisis. There is 1.2 million tons of leftover from last year. The new crop is about to reach the market, where it would create an unprecedented glut and price would crash. The government must prepare a potato procurement plan and try to increase its national consumption. The world per capita potato consumption, he said, was around 50kg against Pakistan’s 10kg, he observed.

The leaf curl virus took a heavy toll on the crop this year and there was a need to stem the possibility of its re-emergence next year, he maintained.