The Punjab agriculture budget, which, apart from routine financial statement, contains Rs7.9 billion annual development plan, up from last year’s Rs5.2 billion, is a mixed bag. It contains some good initiatives, but, at the same time, fails to see policy contradictions among its different plans. These contradictions may create implementation problems, if not adjusted in due course.

One salient feature of the ADP is its stress on education, creating two more campuses for education at Attock and Okara. They would be an addition to countless campuses already existing at Bahawalpur, DG Khan, Burewala, Multan (two in one city), Toba Take Sing, Jhang, Faisalabad, Layyah, Khushab and Rawalpindi (for arid soils), Lahore (the Punjab University) and Sargodha

The provincial government has spared around Rs900 million for ongoing and new educational schemes. Without denying the importance of education, one questions the utility of new centers – apart from political mileage – on two grounds: where is the market to absorb new graduates and, even importantly, what are the quality checks on the product that existing campuses are producing?

Punjab has not hired even one field assistant since 2008 despite having 900 vacancies, squeezing their biggest market. It now plans to produce more graduates without absorbing them. The private sector bemoans the quality of these graduates and refuses to employ a majority of them. That is the point where the provincial government should have concentrated rather than leading to a mushroom growth of campuses with declining quality.

Without going through the phase of demonstration and educating growers on better farming practices, the provincial government is planning to leapfrog to higher planks of IT

It should have brought existing campuses, which can produce much more than provincial and private requirement, under a single body to bring these institutions under one umbrella, accredit them on facilities (both on infrastructural and human), check the quality of syllabus and adjust to market demand. Without it, it would only be adding to already massive unemployment.

In a parallel stream, the provincial government is also busy creating an agriculture technology park, where it plans to integrate all information activities: website, call center and short messaging service (SMS) at one centre — a direct bid to replace field force with technology. It has spared Rs10 million for the park. One hopes that it has carried out the studies that assess the impact and utility of such a park in peculiar provincial circumstances.

Punjab is practicing archaic agriculture, which needs massive technological improvement. No nation has improved its agriculture without demonstration of technology and practices. Without going through that phase of demonstration and practically educating farmers on better practices, the provincial government is planning to leapfrog to higher planks of IT and shunting out people. Will it work? Someone needs to assess.

On a positive note, the province is sticking to vegetables and pulses production plan. Both of them meet basic dietary needs of people but are losing economic sheen because of gross neglect and competitive crops. The provincial government plans to provide better seed for both in order to enhance their production. At the same time, it also needs to realise that providing better seed to farmers does help, but only up to a point: it does not, in any way, ensures adoption of seed and crop.

In order to ensure adoption, it needs to develop entire value chain: seed, farmers’ education on better agriculture practices, ensuring inputs (credit) and, even crucially, putting in place some kind of price insurance — even through buy-back arrangements The province cannot afford to import cheap tomato from India in off-season when prices rise and then expect local farmer to sell them at throw away price during the peak production, and still induce farmers into tomato growth. Similarly, pulses are losing ground to other crops because of poor technology, poor yield and thus becoming a source of poverty.

Planners should also keep in mind that promoting pulses would fly in the face of their other policy thrust i.e. promoting high value crops. Pulses don’t fall in that category and need a separate package in order to ensure better returns to farmers. Otherwise, all those farmers would go for those high value crops, abandoning pulses. For example, Punjab has spared Rs25 million for promoting floriculture as part of diversification. How would it stop farmers going for high yielding flower markers and stick to pulses?

The biggest failure of Punjab remains its agriculture income tax collection. Last year, it promised to improve its collection by 200 per cent — from Rs700 million to over Rs2 billion this year. For achieving the target, it said that everyone having more than 50 acres of land would file a tax return under normal income tax mode, even if he has suffered financial losses and has no taxable income. It failed and renewed the pledge this year as well. This is despite pressure from the federation created by the Federal Finance Minister Ishaq Dar, who, in a recent briefing to the Senate Committee, berated provinces for their failure to meet tax collection obligations.

On another positive note, Punjab has spared Rs5 billion for fertiliser subsidy; it would mainly go to the Di-Ammonium Phosphate (DAP). But it is neutralised by the federal government slapping of gas infrastructure development cess, which would cost Punjab farmers Rs7 billion. The province has taken up the case with the federal government to chime in with more money to facilitate farmers and arrest their ever increasing cost of production. One hopes that federation listens to lighten some burden on the farmers.

Published in Dawn, Economic & Business, June 16th, 2014